Professional Documents
Culture Documents
On February 15, 1940, Fermin Bocobo, in a Deed of On November 8, 1946, Villaflor, in a Lease Agreement
Absolute Sale (exh. B), sold to Villaflor, a parcel of (exh. Q),4 leased to Nasipit Lumber Co., Inc. a parcel of
agricultural land, containing an area of 18 hectares, more land, containing an area of two (2) hectares, together with
or less, and particularly described and bounded as all the improvements existing thereon, for a period of five
follows: (5) years from June 1, 1946 at a rental of P200.00 per
annum "to cover the annual rental of house and building
A certain parcel of agricultural land sites for thirty three (33) houses or buildings." This
planted with abaca with visible part agreement also provides:5
marking the corners and bounded on the
North by the corners and bounded on the 3. During the term of this lease, the
North by Public Land; on the East by Cirilo Lessee is authorized and empowered to
Piencenaves; on the South by build and construct additional houses in
Hermogenes Patete and West by Public addition to the 33 houses or buildings
Land, containing an area of 18 hectares mentioned in the next preceding
more or less now under Tax Declaration paragraph, provided however, that for
No. 29451 in the name of Vicente Villaflor. every additional house or building
The whole parcel of which this particular constructed the Lessee shall pay unto the
parcel is only a part is assessed as Lessor an amount of fifty centavos (¢50)
P22,550.00 for purposes of taxation under per month for every house or building. The
the above said Tax Declaration Number Lessee is empowered and authorized by
(Deed of Absolute Sale executed by the Lessor to sublot (sic) the premises
Fermin Bocobo date Feb. 15, 1940). This hereby leased or assign the same or any
document was annotated in Registry of portion of the land hereby leased to any
Deeds on February 16, 1940). person, firm and corporation; (and)
b) The amount of FIVE In the Report dated December 31, 1949 by the public land
THOUSAND (P5,000.00) PESOS inspector, District Land Office, Bureau of Lands, in Butuan, the
shall be paid upon the signing of report contains an Indorsement of the aforesaid District Land
this present agreement; and Officer recommending rejection of the Sales Application of
Villaflor for having leased the property to another even before he
c) The balance of TWELVE had acquired transmissible rights thereto.
THOUSAND (P12,000.00) shall be
paid upon the execution by the In a letter of Villaflor dated January 23, 1950, addressed to the
First Party of the Absolute Deed of Bureau of Lands, he informed the Bureau Director that he was
Sale of the two parcels of land in already occupying the property when the Bureau's Agusan River
question in favor of the Second Valley Subdivision Project was inaugurated, that the property was
Party, and upon delivery to the formerly claimed as private properties (sic), and that therefore,
Second Party of the Certificate of the property was segregated or excluded from disposition
Ownership of the said two parcels because of the claim of private ownership. In a letter of Nasipit
of land. Lumber dated February 22, 1950 (exh. X)11 addressed to the
Director of Lands, the corporation informed the Bureau that it
9. It is specially understood that the mortgage recognized Villaflor as the real owner, claimant and occupant of
constituted by the First Party in favor of the the land; that since June 1946, Villaflor leased two (2) hectares
Second Party, as stated in the said contract of inside the land to the company; that it has no other interest on the
Agreement to Sell dated July 7, 1948, shall cover land; and that the Sales Application of Villaflor should be given
not only the amount of SEVEN THOUSAND favorable consideration.
(P7,000.00) PESOS as specified in said
document, but shall also cover the amount of xxx xxx xxx
FIVE THOUSAND (P5,000.00) PESOS to be paid
as stipulated in paragraph 8, sub-paragraph (b) of On July 24, 1950, the scheduled date of auction of the property
this present agreement, if the First Party should covered by the Sales Application, Nasipit Lumber offered the
fail to comply with the obligations as provided for highest bid of P41.00 per hectare, but since an applicant under
in paragraphs 2, 4, and 5 of the Agreement to CA 141, is allowed to equal the bid of the highest bidder, Villaflor
Sell; tendered an equal bid; deposited the equivalent of 10% of the bid
price and then paid the assessment in full.
10. It is further agreed that the First Party
obligates himself to sign, execute and deliver to xxx xxx xxx
and in favor of the Second Party, its successors
and assigns, at anytime upon demand by the
Second Party such other instruments as may be
On August 16, 1950, Villaflor executed a document, denominated Also on August 16, 1950, Nasipit Lumber filed a Sales Application
as a "Deed of Relinquishment of Rights" (exh. N),12 pertinent over the two (2) parcels of land, covering an area of 140
portion of which reads: hectares, more or less. This application was also numbered V-
807 (exh. Y).
5. That in view of my present business in Manila,
and my change in residence from Butuan, Agusan On August 17, 1950 the Director of Lands issued an "Order of
to the City of Manila, I cannot, therefore, develope Award"13 in favor of Nasipit Lumber Company, Inc., pertinent
(sic) or cultivate the land applied for as projected portion of which reads:
before;
4. That at the auction sale of the land held on July
6. That the Nasipit Lumber Company, Inc., a 24, 1950 the highest bid received was that of
corporation duly organized . . . is very much Nasipit Lumber Company, Inc. which offered
interested in acquiring the land covered by the P41.00 per hectare or P5,740.00 for the whole
aforecited application . . . ; tract, which bid was equaled by applicant Vicente
J. Villaflor, who deposited the amount of P574.00
7. That I believe the said company is qualified to under Official Receipt No. B-1373826 dated July
acquire public land, and has the means to 24, 1950 which is equivalent to 10% of the bid.
develop (sic) the above-mentioned land; Subsequently, the said . . . Villaflor paid the
amount of P5,160.00 in full payment of the
xxx xxx xxx purchase price of the above-mentioned land and
for some reasons stated in an instrument of
relinquishment dated August 16, 1950, he
WHEREFORE, and in consideration of the
(Vicente J. Villaflor) relinquished his rights to and
amount of FIVE THOUSAND PESOS (P5,000.00)
interest in the said land in favor of the Nasipit
to be reimbursed to me by the aforementioned
Lumber Company, Inc. who filed the
Nasipit Lumber Company, Inc., after its receipt of
corresponding application therefore.
the order of award, the said amount representing
part of the purchase price of the land aforesaid,
the value of the improvements I introduced In view of the foregoing, and it appearing that the
thereon, and the expenses incurred in the proceedings had . . . were in accordance with law
publication of the Notice of Sale, I, the applicant, and in [sic] existing regulations, the land covered
Vicente J. Villaflor, hereby voluntarily renounce thereby is hereby awarded to Nasipit Lumber
and relinquish whatever rights to, and interests I Company, Inc. at P41.00 per hectare or
have in the land covered by my above-mentioned P5,740.00 for the whole tract.
application in favor of the Nasipit Lumber
Company, Inc. This application should be entered in the record of
this Office as Sales Entry No. V-407.
It is Villaflor's claim that he only learned of the Order of Award on During the proceedings, Villaflor presented
January 16, 1974, or after his arrival to the Philippines, coming another claim entirely different from his previous
from Indonesia, where he stayed for more than ten (10) years; claim — this time, for recovery of rentals in
that he went to Butuan City in the latter part of 1973 upon the call arrears arising from a supposed contract of lease
of his brother Serafin Villaflor, who was then sick and learned that by Villaflor as lessor in favor of Nasipit as lessee,
Nasipit Lumber (had) failed and refused to pay the agreed and indemnity for damages supposedly caused
rentals, although his brother was able to collect during the early improvements on his other property . . . in the
years; and that Serafin died three days after his (Vicente's) staggering amount of Seventeen Million
arrival, and so no accounting of the rentals could be made; that (P17,000,000.00) Pesos. Earlier, he had also
on November 27, 1973, Villaflor wrote a letter to Mr. G.E.C. demanded from NASIPIT . . . (P427,000.00) . . .
Mears of Nasipit Lumber, reminding him of their verbal agreement also as indemnity for damages to improvements
in 1955 . . . that Mr. Mears in a Reply dated December 3, 1973, supposedly caused by NASIPIT on his other real
appears to have referred the matter to Mr. Noriega, the corporate property as well as for reimbursement of realty
general manager, but the new set of corporate officers refused to taxes allegedly paid by him thereon.
recognize (Villaflor's) claim, for Mr. Florencio Tamesis, the
general manager of Nasipit Lumber, in a letter dated February 19, xxx xxx xxx
1974, denied Villaflor's itemized claim dated January 5, 1974
(exh. V) to be without valid and legal basis. In the 5th January, It would seem that . . . Villaflor has sought to inject
1974 letter, Villaflor claimed the total amount of P427,000.00 . . . . so many collaterals, if not extraneous claims, into
this case. It is the considered opinion of this Office
In a formal protest dated January 31, 197414 which Villaflor filed that any claim not within the sphere or scope of its
with the Bureau of Lands, he protested the Sales Application of adjudicatory authority as an administrative as well
Nasipit Lumber, claiming that the company has not paid him as quasi-judicial body or any issue which seeks to
P5,000.00 as provided in the Deed of Relinquishment of Rights delve into the merits of incidents clearly outside of
dated August 16, 1950. the administrative competence of this Office to
decide may not be entertained.
xxx xxx xxx
There is no merit in the contention of Villaflor that
. . . (T)hat in a Decision dated August 8, 1977 (exh. 8), the owing to Nasipit's failure to pay the amount of . . .
Director of Lands found that the payment of the amount of (P5,000.00) . . . (assuming that Nasipit had failed)
P5,000.00 in the Deed . . . and the consideration in the the deed of relinquishment became null and void
Agreement to Sell were duly proven, and ordered the dismissal of for lack of consideration. . . . .
Villaflor's protest and gave due course to the Sales Application of
Nasipit Lumber. Pertinent portion of the Decision penned by xxx xxx xxx
Director of Lands, Ramon Casanova, in the Matter of SP No. V-
807 (C-V-407) . . . reads: . . . The records clearly show, however, that since
the execution of the deed of relinquishment . . .
xxx xxx xxx
Villaflor has always considered and recognized xxx xxx xxx
NASIPIT as having the juridical personality to
acquire public lands for agricultural purposes. . . . Consequently, Villaflor's claim that he had not
. been paid must perforce fail.
xxx xxx xxx
On the other hand, there are strong and
compelling reasons to presume that Villaflor
Even this Office had not failed to recognize the
juridical personality of NASIPIT to apply for the had already been paid the amount of Five
purchase of public lands . . . when it awarded to it Thousand (P5,000.00) Pesos.
the land so relinquished by Villaflor (Order of
Award dated August 17, 1950) and accepted its First, . . . What is surprising, however, is not
application therefor. At any rate, the question so much his claims consisting of gigantic
whether an applicant is qualified to apply for the amounts as his having forgotten to adduce
acquisition of public lands is a matter between the evidence to prove his claim of non-payment
applicant and this Office to decide and which a of the Five Thousand (P5,000.00) Pesos
third party like Villaflor has no personality to during the investigation proceedings when he
question beyond merely calling the attention of
had all the time and opportunity to do so. . . .
this Office thereto.
The fact that he did not adduce or even
xxx xxx xxx
attempt to adduce evidence in support thereof
shows either that he had no evidence to offer
Villaflor offered no evidence to support his claim
. . . that NASIPIT had already paid him in fact.
of non-payment beyond his own self-serving What is worse is that Villaflor did not even
assertions and expressions that he had not been bother to command payment, orally or in
paid said amount. As protestant in this case, he writing, of the Five Thousand (P5,000.00)
has the affirmative of the issue. He is obliged to Pesos which was supposed to be due him
prove his allegations, otherwise his action will fail. since August 17, 1950, the date when the
For, it is a well settled principle (') that if plaintiff order of award was issued to Nasipit, and
upon whom rests the burden of proving his cause when his cause of action to recover payment
of action fails to show in a satisfactory manner the had accrued. The fact that he only made a
facts upon which he bases his claim, the command (sic) for payment on January 31,
defendant is under no obligation to prove his
1974, when he filed his protest or twenty-four
exceptions or special defenses (Belen vs. Belen,
13 Phil. 202; Mendoza vs. Fulgencio, 8 Phil. 243). (24) years later is immediately nugatory of his
claim for non-payment.
But Villaflor maintains that he had no Third, on the other hand, NASIPIT has in his
knowledge or notice that the order of award possession a sort of "order" upon itself — (the
had already been issued to NASIPIT as he deed of relinquishment wherein he (sic)
had gone to Indonesia and he had been obligated itself to reimburse or pay Villaflor
absent from the Philippines during all those the . . . consideration of the relinquishment
twenty-four (24) years. This of course taxes upon its receipt of the order of award) for the
credulity. . . . . payment of the aforesaid amount the moment
the order of award is issued to it. It is
Second, it should be understood that the reasonable to presume that NASIPIT has
condition that NASIPIT should reimburse paid the Five Thousand (P5,000.00) Pesos to
Villaflor the amount of Five Thousand Villaflor.
(P5,000.00) Pesos upon its receipt of the
order of award was fulfilled as said award A person in possession of an
was issued to NASIPIT on August 17, 1950. order on himself for the
The said deed of relinquishment was payment of money, or the
prepared and notarized in Manila with Villaflor delivery of anything, has paid
and NASIPIT signing the instrument also in the money or delivered the
Manila on August 16, 1950 (p. 77, (sic)). The thing accordingly. (Section 5(k)
following day or barely a day after that, or on B-131 Revised Rules of Court.
August 17, 1950, the order of award was
issued by this Office to NASIPIT also in It should be noted that NASIPIT did not
Manila. Now, considering that Villaflor is produce direct evidence as proof of its
presumed to be more assiduous in following payment of the Five Thousand (P5,000.00)
up with the Bureau of Lands the expeditious Pesos to Villaflor. Nasipit's explanation on
issuance of the order of award as the this point is found satisfactory.
payment of the Five Thousand (P5,000.00)
Pesos (consideration) would depend on the . . . (I)t was virtually impossible
issuance of said order to award NASIPIT, for NASIPIT, after the lapse of
would it not be reasonable to believe that the intervening 24 years, to be
Villaflor was at hand when the award was able to cope up with all the
issued to NASIPIT an August 17, 1950, or records necessary to show that
barely a day which (sic) he executed the deed the consideration for the deed
of relinquishment on August 16, 1950, in of relinquishment had been
Manila? . . . . fully paid. To expect NASIPIT
to keep intact all records
pertinent to the transaction for provision of the law is specific that public
the whole quarter of a century lands can only be acquired in the manner
would be to require what even provided for therein and not otherwise (Sec.
the law does not. Indeed, even 11, C.A. No. 141, as amended). The records
the applicable law itself (Sec. show that Villaflor had applied for the
337, National Internal Revenue purchase of the lands in question with this
Code) requires that all records Office (Sales Application No. V-807) on
of corporations be preserved December 2, 1948. . . . . There is a condition
for only a maximum of five in the sales application signed by Villaflor to
years. the effect that he recognizes that the land
covered by the same is of public domain and
NASIPIT may well have added that at any any and all rights he may have with respect
rate while "there are transactions where the thereto by virtue of continuous occupation
proper evidence is impossible or extremely and cultivation are relinquished to the
difficult to produce after the lapse of time . . . Government (paragraph 6, Sales Application
the law creates presumptions of regularity in No. V-807 . . .) of which Villaflor is very much
favor of such transactions (20 Am. Jur. 232) aware. It also appears that Villaflor had paid
so that when the basic fact is established in for the publication fees appurtenant to the
an action the existence of the presumed fact sale of the land. He participated in the public
must be assumed by force of law. (Rule 13, auction where he was declared the
Uniform Rules of Evidence; 9 Wigmore, Sec. successful bidder. He had fully paid the
2491). purchase prive (sic) thereof (sic). It would be
a (sic) height of absurdity for Villaflor to be
Anent Villaflor's claim that the 140-hectare buying that which is owned by him if his claim
land relinquished and awarded to NASIPIT is of private ownership thereof is to be believed.
his private property, little (need) be said. . . . . The most that can be said is that his
The tracks of land referred to therein are not possession was merely that of a sales
identical to the lands awarded to NASIPIT. applicant to when it had not been awarded
Even in the assumption that the lands because he relinquished his interest therein in
mentioned in the deeds of transfer are the favor of NASIPIT who (sic) filed a sales
same as the 140-hectare area awarded to application therefor.
NASIPIT, their purchase by Villaflor (or) the
latter's occupation of the same did not xxx xxx xxx
change the character of the land from that of
public land to a private property. The
. . . During the investigation proceedings, Second Party to the First Party
Villaflor presented as his Exhibit "(sic)" (which upon the execution of the
NASIPIT adopted as its own exhibit and had it Agreement to Sell, on July 17,
marked in evidence as Exhibit "1") a duly 1948;
notarized "agreement to Sell" dated July 7,
1948, by virtue of which Villaflor undertook to b) the amount of FIVE
sell to Nasipit the tracts of land mentioned THOUSAND . . . PESOS shall
therein, for a consideration of Twenty-Four be paid upon the signing of this
Thousand (P24,000.00) Pesos. Said tracts of present agreement; and
land have been verified to be identical to the
parcels of land formerly applied for by Villaflor c) the amount of TWELVE
and which the latter had relinquished in favor THOUSAND . . . PESOS, shall
of NASIPIT under a deed of relinquishment be paid upon the execution by
executed by him on August 16, 1950. In the First Party of the Absolute
another document executed on December 7, Sale of the Two parcels of land
1948 . . . Villaflor as "FIRST PARTY" and in question in favor of the
NASIPIT as "SECOND PARTY" confirmed Second Party of the Certificate
the "Agreement to Sell" of July 7, 1948, which of Ownership of the said two
was maintained "in full force and effect with parcels of land. (Exh. 38-B).
all its terms and conditions . . ." (Exh. "38-A"); (Emphasis ours)
and that "for and in consideration of . . .
TWENTY FOUR THOUSAND (P24,000.00) It is thus clear from this subsequent
PESOS that the Second Party shall pay to the document marked Exhibit "38 ANALCO"
First Party . . . the First Party hereby sells,
transfers and conveys unto the Second Party
that of the consideration of the
. . . his right interest and participation under "Agreement to Sell" dated July 7, 1948,
and by virtue of the Sales Application No. V- involving the 140-hectare area
807" and, in its paragraph 8, it made relinquished by Villaflor in favor of
stipulations as to when part of the said NASIPIT, in the amount of Twenty-Four
consideration . . . was paid and when the Thousand (P24,000.00) Pesos:
balance was to be paid, to wit:
(1) the amount of Seven Thousand
a) the amount of SEVEN
(P7,000.00) Pesos was already paid
THOUSAND . . . PESOS has
already been paid by the upon the execution of the "Agreement to
Sell" on July 7, 1948, receipt of which applicant-assignor was not able to
incidentally was admitted by Villaflor in obtain a Torrens Title over the land in
the document of December 7, 1948; question he could not execute an
absolute Deed of (sic) Nasipit Lumber
(2) the amount of Five Thousand Co., Inc. Hence, the Agreement to Sell
(P5,000.00) Pesos was paid when said was not carried out and no Twelve
document was signed by Vicente J. Thousand (P12,000.00) Pesos was
Villaflor as the First Party and Nasipit overpaid either to the applicant-
thru its President, as the Second Party, assignor, much less to Howard J. Nell
on December 7, 1948; and Company. (See MEMORANDUM FOR
THE APPLICANT-ASSIGNOR, dated
(3) the balance of Twelve Thousand January 5, 1977). . . .
(P12,000.00) Pesos to be paid upon the
execution by the First Party of the . . . Villaflor did not adduce evidence in
Absolute Deed of Sale of the two support of his claim that he had not
parcels of land in favor of the Second been paid the . . . (P12,000.00) . . .
Party, and upon delivery to the Second consideration of the Agreement to Sell
Party of the Certificate of Ownership of dated July 7, 1948 (Exh. "38 NALCO")
the said two parcels of land. beyond his mere uncorroborated
assertions. On the other hand, there is
Villaflor contends that NASIPIT could strong evidence to show that said
not have paid Villaflor the balance of Twelve Thousand (P12,000.00) Pesos
Twelve Thousand (P12,000.00) Pesos . had been paid by (private respondent)
. . consideration in the Agreement to to Edward J. Nell Company by virtue of
Sell will only be paid to applicant- the Deed of Assignment of Credit
assignor (referring to Villaflor) upon executed by Villaflor (Exh. "41 NALCO")
obtaining a Torrens Title in his favor for the credit of the latter.
over the 140-hectare of land applied for
and upon execution by him of a Deed of Atty. Gabriel Banaag, resident counsel
Absolute Sale in favor of Nasipit Lumber of NASIPIT who is in a position to know
Company, Inc. . . . . Inasmuch as the facts, testified for NASIPIT. He
described that it was he who notarized credit. . . . Villaflor and his counsel were
the "Agreement to Sell" (Exh. "F"); that present when Atty. Banaag's foregoing
he knew about the execution of the testimony was Villaflor did not demur,
document of December 7, 1948 (Exh. nor did he rebut the same, despite
"38") confirming the said "Agreement to having been accorded full opportunity to
Sell" having been previously consulted do so.
thereon by Jose Fernandez, who signed
said document on behalf of NASIPIT . . . xxx xxx xxx
that subsequently, in January 1949,
Villaflor executed a Deed of Assignment Having found that both the Five
of credit in favor of Edward J. Nell Thousand . . . consideration of the deed
Company (Exh. "41 NALCO") whereby of Relinquishment . . . and that the
Villaflor ceded to the latter his receivable remaining balance of
for NASIPIT corresponding to the . . . (P12,000.00) to complete the
remaining balance in the amount of Twenty-Four Thousand (P24,000.00)
Twelve Thousand . . . Pesos of the total Pesos consideration of both the
consideration . . . stipulated in both the Agreement to Sell dated July 7, 1948,
"Agreement to Sell" (Exh. "F") and the and the document, dated December 7,
document dated December 7, 1948 1948, executed by the former in favor of
(Exh. "39"); the latter, have been paid Villaflor the
. . . . He further testified that the said issue on prescription and laches
assignment of credit was communicated becomes academic and needs no
to (private respondent) under cover further discussion.
letter dated January 24, 1949 (Exh. "41-
A") and not long thereafter, by virtue of But more than all the questions thus far
the said assignment of credit, (private raised and resolved is the question
respondent) paid the balance of Twelve whether a sales patent can be issued to
Thousand . . . due to Villaflor to Edward NASIPIT for the 140-hectare area
J. Nell Company . . . . Atty. Banaag's awarded to it in the light of Section 11,
aforesaid testimony stand unrebutted; Article XIV of the new Constitution which
hence, must be given full weight and provides in its pertinent portion to wit:
. . . No private corporation On the other hand, with
or association may hold respect to sales
alienable land of the public applications ready for
domain except by lease not issuance of sales patent, it
to exceed one thousand is my opinion that where the
hectares in area . . . . applicant had, before the
Constitution took effect,
The Secretary of Justice had previous fully complied with all this
occasion to rule on this point in his obligations under the Public
opinion No. 140, s. 1974. Said the Land Act in order to entitle
Honorable Justice Secretary: him to a Sales patent, there
would be no legal or
On the second question, equitable justification for
(referring to the questions refusing to issue or release
when may a public land be the sales patent.
considered to have been
acquired by purchase With respect to the point as to when the
before the effectivity of the Sales applicant has complied with all the
new Constitution posed by terms and conditions which would entitle
the Director of Lands in his him to a sales patent, the herein above
query on the effect on Secretary of Justice went on:
pending applications for the
issuance of sales patent in That as to when the
the light of Section 11, Art. applicant has complied with
XIV of the New Constitution all the terms and conditions
aforecited), you refer to this which would entitle him to a
Office's Opinion No. 64 patent is a questioned (sic)
series of 1973 in which I fact which your office would
stated: be in the best position to
determine. However,
relating this to the
procedure for the Firstly, the area in dispute is not the private property of appellant.
processing of applications
The evidence adduced by appellant to establish his claim of ownership
mentioned above, I think over the subject area consists of deeds of absolute sale executed in his
that as the applicant has favor on January 16, and February 15, 1940, by four (4) different
persons, namely, Cirilo Piencenaves, Fermin Balobo, Claudio Otero and
fulfilled the Hermogenes Patete.
construction/cultivation
requirements and has fully However, an examination of the technical descriptions of the tracts of
paid the purchase price, he land subject of the deeds of sale will disclose that said parcels are not
identical to, and do not tally with, the area in controversy.
should be deemed to have
acquired by purchase the It is a basic assumption of our policy that lands of
particular tract of land and whatever classification belong to the state. Unless
alienated in accordance with law, it retains its rights
(sic) the area (sic) in the over the same as dominus, (Santiago vs. de los
provision in question of the Santos, L-20241, November 22, 1974, 61 SCRA 152).
new constitution would not
apply. For, it is well-settled that no public land can be acquired
by private persons without any grant, express or
implied from the government. It is indispensable then
From the decision of the Director of Lands, Villaflor that there be showing of title from the state or any other
filed a Motion for Reconsideration which was mode of acquisition recognized by law. (Lee Hong Hok,
et al. vs. David, et al., L-30389, December 27, 1972, 48
considered as an Appeal M.N.R. Case 4341, to the SCRA 379.)
Ministry of Natural Resources.
It is well-settled that all lands remain part of the public domain unless
severed therefrom by state grant or unless alienated in accordance with
On June 6, 1979, the Minister of Natural Resources law.
rendered a Decision (exh. 9), 15 dismissing the appeal
and affirming the decision of the Director of Lands, We, therefore, believe that the aforesaid deeds of sale do not constitute
pertinent portions of which reads: clear and convincing evidence to establish that the contested area is of
private ownership. Hence, the property must be held to be public
domain.
After a careful study of the records and
the arguments of the parties, we believe "There being no evidence whatever that the property in
that the appeal is not well taken. question was ever acquired by the applicants or their
ancestors either by composition title from the Spanish
Government or by possessory information title or by
any other means for the acquisition of public lands, the
property must be held to be public domain." (Lee Hong
Hok, et al., vs. David , et al., L-30389 December 27,
Lastly, appellee has acquired a
1972, 48 SCRA 378-379 citing Heirs of Datu Pendatun vested right to the subject area
vs. Director of Lands; see also Director of Lands vs.
Reyes, L-27594, November 28, 1975, 68 SCRA 177). and, therefore, is deemed not
affected by the new constitutional
Be that as it may, appellant, by filing a sales application over the
controverted land, acknowledged unequivocably [sic] that the same is
provision that no private
not his private property. corporation may hold alienable
"As such sales applicant, appellant manifestly
land of the public domain except
acknowledged that he does not own the land and that by lease.
the same is a public land under the administration of
the Bureau of Lands, to which the application was
submitted, . . . All of its acts prior thereof, including its xxx xxx xxx
real estate tax declarations, characterized its
possessions of the land as that of a "sales applicant"
and consequently, as one who expects to buy it, but Implementing the aforesaid
has not as yet done so, and is not, therefore, its Opinion No. 64 of the Secretary of
owner." (Palawan Agricultural and Industrial Co., Inc.
vs. Director of Lands, L-25914, March 21, 1972, 44 Justice, the then Secretary of
SCRA 20, 21). Agriculture and Natural Resources
Secondly, appellant's alleged failure to pay the consideration stipulated issued a memorandum, dated
in the deed of relinquishment neither converts said deed into one without February 18, 1974, which
a cause or consideration nor ipso facto rescinds the same. Appellant,
though, has the right to demand payment with legal interest for the delay pertinently reads as follows:
or to demand rescission.
In the implementation of
However, appellant's cause of the foregoing opinion,
action, either for specific sales application of
performance or rescission of private individuals
contract, with damages, lies within covering areas in
the jurisdiction of civil courts, not excess of 24 hectares
with administrative bodies. and those of
corporations,
xxx xxx xxx
associations, or effectivity of the New Constitution.
partnership which fall To restate, the disputed area was
under any of the awarded to appellee on August
17, 1950, the purchase price was
following categories fully paid on July 26, 1951, the
shall be given due cultivation requirements were
course and issued complied with as per investigation
patents, to wit: report dated December 31, 1949,
and the land was surveyed under
1. Sales application for fishponds and for agricultural Pls-97.
purposes (SFA, SA and IGPSA) wherein prior to
January 17, 1973; On July 6, 1978, petitioner filed a complaint16 in the
trial court for "Declaration of Nullity of Contract (Deed
a. the land covered thereby was of Relinquishment of Rights), Recovery of
awarded; Possession (of two parcels of land subject of the
contract), and Damages" at about the same time that
b. cultivation requirements of law were he appealed the decision of the Minister of Natural
complied with as shown by investigation Resources to the Office of the President.
reports submitted prior to January 17,
1973; On January 28, 1983, petitioner died. The trial court
ordered his widow, Lourdes D. Villaflor, to be
c. land was surveyed and survey returns substituted as petitioner. After trial in due course, the
already submitted to the Director of then Court of First Instance of Agusan del Norte and
Lands for verification and approval; and Butuan City, Branch III,17 dismissed the complaint on
the grounds that: (1) petitioner admitted the due
d. purchased price was fully paid. execution and genuineness of the contract and was
estopped from proving its nullity, (2) the verbal lease
From the records, it is evident that agreements were unenforceable under Article 1403
the aforestated requisites have (2) (e) of the Civil Code, and (3) his causes of action
been complied with by appellee were barred by extinctive prescription and/or laches.
long before January 17, 1973, the It ruled that there was prescription and/or laches
because the alleged verbal lease ended in 1966, but Double the costs against the plaintiff.
the action was filed only on January 6, 1978. The
six-year period within which to file an action on an The heirs of petitioner appealed to Respondent
oral contract per Article 1145 (1) of the Civil Code Court of Appeals19 which, however, rendered
expired in 1972. The decretal portion18 of the trial judgment against petitioner via the assailed Decision
court's decision reads: dated September 27, 1990 finding petitioner's
prayers — (1) for the declaration of nullity of the
WHEREFORE, the foregoing premises duly deed of relinquishment, (2) for the eviction of private
considered, judgment is hereby rendered in respondent from the property and (3) for the
favor of the defendant and against the plaintiff. declaration of petitioner's heirs as owners — to be
Consequently, this case is hereby ordered without basis. The decretal portion20 of the assailed
DISMISSED. The defendant is hereby 49-page, single-spaced Decision curtly reads:
declared the lawful actual physical possessor-
occupant and having a better right of WHEREFORE, the Decision appealed from, is
possession over the two (2) parcels of land in hereby AFFIRMED, with costs against plaintiff-
litigation described in par. 1.2 of the complaint appellants.
as Parcel I and Parcel II, containing a total
area of One Hundred Sixty (160) hectares, Not satisfied, petitioner's heirs filed the instant 57-
and was then the subject of the Sales page petition for review dated December 7, 1990. In
Application No. V-807 of the plaintiff (Exhibits a Resolution dated June 23, 1991, the Court denied
1, 1-A, 1-B, pp. 421 to 421-A, Record), and this petition "for being late." On reconsideration —
now of the Sales Application No. 807, Entry upon plea of counsel that petitioners were "poor" and
No. V-407 of the defendant Nasipit Lumber that a full decision on the merits should be rendered
Company (Exhibit Y, pp. 357-358, Record). — the Court reinstated the petition and required
The Agreements to Sell Real Rights, Exhibits comment from private respondent. Eventually, the
2 to 2-C, 3 to 3-B, and the Deed of petition was granted due course and the parties thus
Relinquishment of Rights, Exhibits N to N-1, filed their respective memoranda.
over the two parcels of land in litigation are
hereby declared binding between the plaintiff The Issues
and the defendant, their successors and
assigns.
Petitioner, through his heirs, attributes the following VII. Did the Court of Appeals consider the fact
errors to the Court of Appeals: and the unrefuted claim of Villaflor that he
never knew of the award in favor of Nasipit?
I. Are the findings of the Court of Appeals
conclusive and binding upon the Supreme VIII. Did the Court of Appeals correctly apply
Court? the rules on evidence in its findings that
Villaflor was paid the P5,000.00 consideration
II. Are the findings of the Court of Appeals because Villaflor did not adduce any proof that
fortified by the similar findings made by the he was not paid?
Director of Lands and the Minister of Natural
Resources (as well as by the Office of the IX. Is the Court of Appeals' conclusion that the
President)? contract is not simulated or fictitious simply
because it is genuine and duly executed by
III. Was there "forum shopping?". the parties, supported by logic or the law?
IV. Are the findings of facts of the Court of X. May the prestations in a contract agreeing
Appeals and the trial court supported by the to transfer certain rights constitute estoppel
evidence and the law? when this very contract is the subject of an
action for annulment on the ground that it is
V. Are the findings of the Court of Appeals fictitious?
supported by the very terms of the contracts
which were under consideration by the said XI. Is the Court of Appeals' conclusion that the
court? lease agreement between Villaflor is verbal
and therefore, unenforceable supported by the
VI. Did the Court of Appeals, in construing the evidence and the law?
subject contracts, consider the
contemporaneous and subsequent act of the After a review of the various submissions of the
parties pursuant to article 1371 of the Civil parties, particularly those of petitioner, this Court
Code? believes and holds that the issues can be condensed
into three as follows:
(1) Did the Court of Appeals err in adopting or Underlying the rulings of the trial and appellate courts is the
doctrine of primary jurisdiction; i.e., courts cannot and will not
relying on the factual findings of the Bureau of
resolve a controversy involving a question which is within the
Lands, especially those affirmed by the jurisdiction of an administrative tribunal, especially where the
Minister (now Secretary) of Natural Resources question demands the exercise of sound administrative discretion
and the trial court? requiring the special knowledge, experience and services of the
administrative tribunal to determine technical and intricate matters
of fact.21
(2) Did the Court of Appeals err in upholding
the validity of the contracts to sell and the In recent years, it has been the jurisprudential trend to apply this
deed of relinquishment? Otherwise stated, did doctrine to cases involving matters that demand the special
the Court of Appeals err in finding the deed of competence of administrative agencies even if the question
relinquishment of rights and the contracts to involved is also judicial in character. It applies "where a claim is
originally cognizable in the courts, and comes into play whenever
sell valid, and not simulated or fictitious? enforcement of the claim requires the resolution of issues which,
under a regulatory scheme, have been placed within the special
(3) Is the private respondent qualified to competence of an administrative body; in such case, the judicial
acquire title over the disputed property? process is suspended pending referral of such issues to the
administrative body for its view."22
The Court's Ruling
In cases where the doctrine of primary jurisdiction is clearly
The petition is bereft of merit. It basically questions the sufficiency applicable, the court cannot arrogate unto itself the authority to
of the evidence relied upon by the Court of Appeals, alleging that resolve a controversy, the jurisdiction over which is initially lodged
public respondent's factual findings were based on speculations, with an administrative body of special competence.23 InMachete
surmises and conjectures. Petitioner insists that a review of those vs. Court of Appeals, the Court upheld the primary jurisdiction of
findings is in order because they were allegedly (1) rooted, not on the Department of Agrarian Reform Adjudicatory Board (DARAB)
specific evidence, but on conclusions and inferences of the in an agrarian dispute over the payment of back rentals under a
Director of Lands which were, in turn, based on misapprehension leasehold contract.24 In Concerned Officials of the Metropolitan
of the applicable law on simulated contracts; (2) arrived at Waterworks and Sewerage System vs. Vasquez,25 the Court
whimsically — totally ignoring the substantial and admitted fact recognized that the MWSS was in the best position to evaluate
that petitioner was not notified of the award in favor of private and to decide which bid for a waterworks project was compatible
respondent; and (3) grounded on errors and misapprehensions, with its development plan.
particularly those relating to the identity of the disputed area.
The rationale underlying the doctrine of primary jurisdiction finds
First Issue: Primary Jurisdiction of the Director of Lands and application in this case, since the questions on the identity of the
Finality of Factual Findings of the Court of Appeals land in dispute and the factual qualification of private respondent
as an awardee of a sales application require a technical
determination by the Bureau of Lands as the administrative
agency with the expertise to determine such matters. Because when approved by the Secretary of Agriculture and
these issues preclude prior judicial determination, it behooves the Commerce.
courts to stand aside even when they apparently have statutory
power to proceed, in recognition of the primary jurisdiction of the Thus, the Director of Lands, in his decision, said:28
administrative agency.26
. . . It is merely whether or not Villaflor has been paid the
One thrust of the multiplication of administrative agencies Five Thousand (P5,000.00) Pesos stipulated
is that the interpretation of contracts and the consideration of the deed of relinquishment made by him
determination of private rights thereunder is no longer a without touching on the nature of the deed of
uniquely judicial function, exercisable only by our regular relinquishment. The administration and disposition of
courts.27 public lands is primarily vested in the Director of Lands
and ultimately with the Secretary of Agriculture and
Petitioner initiated his action with a protest before the Bureau of Natural Resources (now Secretary of Natural Resources),
Lands and followed it through in the Ministry of Natural and to this end —
Resources and thereafter in the Office of the President.
Consistent with the doctrine of primary jurisdiction, the trial and Our Supreme Court has recognized that
the appellate courts had reason to rely on the findings of these the Director of Lands is a quasi-judicial
specialized administrative bodies. officer who passes on issues of mixed
facts and law (Ortua vs. Bingson
The primary jurisdiction of the director of lands and the minister of Encarnacion, 59 Phil 440). Sections 3 and
natural resources over the issues regarding the identity of the 4 of the Public Land Law thus mean that
disputed land and the qualification of an awardee of a sales the Secretary of Agriculture and Natural
patent is established by Sections 3 and 4 of Commonwealth Act Resources shall be the final arbiter on
No. 141, also known as the Public Land Act: questions of fact in public land conflicts
(Heirs of Varela vs. Aquino, 71 Phil 69;
Sec. 3. The Secretary of Agriculture and Commerce (now Julian vs. Apostol, 52 Phil 442).
Secretary of Natural Resources) shall be the executive
officer charged with carrying out the provisions of this Act The ruling of this Office in its order dated September 10,
through the Director of Lands, who shall act under his 1975, is worth reiterating, thus:
immediate control.
. . . it is our opinion that in the exercise of
Sec. 4. Subject to said control, the Director of Lands shall his power of executive control,
have direct executive control of the survey, classification, administrative disposition and allegation of
lease, sale or any other form of concession or disposition public land, the Director of Lands should
and management of the lands of the public domain, and entertain the protest of Villaflor and
his decision as to questions of fact shall be conclusive conduct formal investigation . . . to
determine the following points: (a) whether
or not the Nasipit Lumber Company, Inc. courts.32 It is incumbent on the petitioner to show that the
paid or reimbursed to Villaflor the resolution of the factual issues by the administrative agency
consideration of the rights in the amount and/or by the trial court falls under any of the exceptions.
of P5,000.00 and what evidence the Otherwise, this Court will not disturb such findings.33
company has to prove payment, the
relinquishment of rights being part of the We mention and quote extensively from the rulings of the Bureau
administrative process in the disposition of of Lands and the Minister of Natural Resources because the
the land in question . . . . points, questions and issues raised by petitioner before the trial
court, the appellate court and now before this Court are basically
. . . . Besides, the authority the same as those brought up before the aforesaid specialized
of the Director of Lands to administrative agencies. As held by the Court of
pass upon and determine Appeals:34
questions considered
inherent in or essential to We find that the contentious points raised by appellant in
the efficient exercise of his this action, are substantially the same matters he raised
powers like the incident at in BL Claim No. 873 (N). In both actions, he claimed
issue, i.e. , whether private ownership over the land in question, assailed the
Villaflor had been paid or validity and effectiveness of the Deed of Relinquishment
not, is conceded bylaw. of Rights he executed in August 16, 1950, that he had not
been paid the P5,000.00 consideration, the value of the
Reliance by the trial and the appellate courts on the factual improvements he introduced on the land and other
findings of the Director of Lands and the Minister of Natural expenses incurred by him.
Resources is not misplaced. By reason of the special knowledge
and expertise of said administrative agencies over matters falling In this instance, both the principle of primary jurisdiction of
under their jurisdiction, they are in a better position to pass administrative agencies and the doctrine of finality of factual
judgment thereon; thus, their findings of fact in that regard are findings of the trial courts, particularly when affirmed by the Court
generally accorded great respect, if not finality,29 by the of Appeals as in this case, militate against petitioner's cause.
courts.30 The findings of fact of an administrative agency must be Indeed, petitioner has not given us sufficient reason to deviate
respected as long as they are supported by substantial evidence, from them.
even if such evidence might not be overwhelming or even
preponderant. It is not the task of an appellate court to weigh Land in Dispute Is Public Land
once more the evidence submitted before the administrative body
and to substitute its own judgment for that of the administrative
Petitioner argues that even if the technical description in the
agency in respect of sufficiency of evidence.31
deeds of sale and those in the sales application were not
identical, the area in dispute remains his private property. He
However, the rule that factual findings of an administrative alleges that the deeds did not contain any technical description,
agency are accorded respect and even finality by courts admits of as they were executed prior to the survey conducted by the
exceptions. This is true also in assessing factual findings of lower
Bureau of Lands; thus, the properties sold were merely described appears that Villaflor had paid for the publication fees
by reference to natural boundaries. His private ownership thereof appurtenant to the sale of the land. He participated in the
was also allegedly attested to by private respondent's former field public auction where he was declared the successful
manager in the latter's February 22, 1950 letter, which contained bidder. He had fully paid the purchase prive (sic) thereor
an admission that the land leased by private respondent was (sic). It would be a (sic) height of absurdity for Villaflor to
covered by the sales application. be buying that which is owned by him if his claim of
private ownership thereof is to be
This contention is specious. The lack of technical description did believed. . . . .
not prove that the finding of the Director of Lands lacked
substantial evidence. Here, the issue is not so much whether the This finding was affirmed by the Minister of Natural Resources:36
subject land is identical with the property purchased by petitioner.
The issue, rather, is whether the land covered by the sales Firstly, the area in dispute is not the private property of
application is private or public land. In his sales application, appellant (herein petitioner).
petitioner expressly admitted that said property was public land.
This is formidable evidence as it amounts to an admission against The evidence adduced by (petitioner) to establish his
interest. claim of ownership over the subject area consists of
deeds of absolute sale executed in his favor . . . .
In the exercise of his primary jurisdiction over the issue, Director
of Lands Casanova ruled that the land was public:35 However, an examination of the technical descriptions of
the tracts of land subject of the deeds of sale will disclose
. . . Even (o)n the assumption that the lands mentioned in that said parcels are not identical to, and do not tally with,
the deeds of transfer are the same as the 140-hectare the area in controversy.
area awarded to Nasipit, their purchase by Villaflor (or)
the latter's occupation of the same did not change the It is a basic assumption of our policy that
character of the land from that of public land to a private lands of whatever classification belong to
property. The provision of the law is specific that public the state. Unless alienated in accordance
lands can only be acquired in the manner provided for with law, it retains its rights over the same
therein and not otherwise (Sec. 11, C.A. No. 141, as as dominus. (Santiago vs. de los Santos,
amended). The records show that Villaflor had applied for L-20241, November 22, 1974, 61 SCRA
the purchase of lands in question with this Office (Sales 152).
Application No. V-807) on December 2, 1948. . . . There
is a condition in the sales application . . . to the effect that
For it is well-settled that no public land can
he recognizes that the land covered by the same is of
be acquired by private persons without
public domain and any and all rights he may have with
any grant, express or implied from the
respect thereto by virtue of continuous occupation and
government. It is indispensable then that
cultivation are relinquished to the Government (paragraph
there be showing of title from the state or
6, Sales Application No. V-807 of Vicente J. Villaflor, p.
any other mode of acquisition recognized
21, carpeta) of which Villaflor is very much aware. It also
by law. (Lee Hong Hok, et al. vs. David, et Director of Lands, L-25914, March 21,
al., L-30389, December 27, 1972, 48 1972, 44 SCRA 15).
SCRA 379).
Clearly, this issue falls under the primary jurisdiction of the
xxx xxx xxx Director of Lands because its resolution requires "survey,
classification, . . . disposition and management of the lands of the
We, therefore, believe that the aforesaid deeds of sale do public domain." It follows that his rulings deserve great respect.
not constitute clear and convincing evidence to establish As petitioner failed to show that this factual finding of the Director
that the contested area is of private ownership. Hence, of Lands was unsupported by substantial evidence, it assumes
the property must be held to be public domain. finality. Thus, both the trial and the appellate courts correctly
relied on such finding.37 We can do no less.
There being no evidence whatever that
the property in question was ever acquired Second Issue: No Simulation of Contracts Proven
by the applicants or their ancestors either
by composition title from the Spanish Petitioner insists that contrary to Article 137138 of the Civil Code,
Government or by possessory information Respondent Court erroneously ignored the contemporaneous and
title or by any other means for the subsequent acts of the parties; hence, it failed to ascertain their
acquisition of public lands, the property true intentions. However, the rule on the interpretation of
must be held to be public domain. contracts that was alluded to by petitioner is used in affirming, not
negating, their validity. Thus, Article 1373,39 which is a conjunct of
Be that as it may, [petitioner], by filing a sales application Article 1371, provides that, if the instrument is susceptible of two
over the controverted land, acknowledged unequivocably or more interpretations, the interpretation which will make it valid
[sic] that the same is not his private property. and effectual should be adopted. In this light, it is not difficult to
understand that the legal basis urged by petitioner does not
As such sales applicant manifestly support his allegation that the contracts to sell and the deed of
acknowledged that he does not own the relinquishment are simulated and fictitious. Properly understood,
land and that the same is a public land such rules on interpretation even negate petitioner's thesis.
under the administration of the Bureau of
Lands, to which the application was But let us indulge the petitioner awhile and determine whether the
submitted, . . . All of its acts prior thereof, cited contemporaneous and subsequent acts of the parties
including its real estate tax declarations, support his allegation of simulation. Petitioner asserts that the
characterized its possessions of the land relinquishment of rights and the agreements to sell were
as that of a "sales applicant". And simulated because, first, the language and terms of said contracts
consequently, as one who expects to buy negated private respondent's acquisition of ownership of the land
it, has not as yet done so, and is not, in issue; and second, contemporaneous and subsequent
therefore, its owner." (Palawan communications between him and private respondent allegedly
Agricultural and Industrial Co., Inc. vs. showed that the latter admitted that petitioner owned and
occupied the two parcels; i.e., that private respondent was not
applying for said parcels but was interested only in the two agreements. The intent to sell, on the other hand, is as clear as
hectares it had leased, and that private respondent supported daylight.
petitioner's application for a patent.
Petitioner alleges further that the deed of relinquishment of right
Petitioner explains that the Agreement to Sell dated December 7, did not give full effect to the two agreements to sell, because the
1948 did not and could not transfer ownership because preliminary clauses of the deed allegedly served only to give
paragraph 8 (c) thereof stipulates that the "balance of twelve private respondent an interest in the property as a future owner
thousand pesos (12,000.00) shall be paid upon the execution by thereof and to enable respondent to follow up petitioner's sales
the First Party [petitioner] of the Absolute Deed of Sale of the two application.
parcels of land in question in favor of the Second Party, and upon
delivery to the Second Party [private respondent] of the We disagree. Such an intention is not indicated in the deed. On
Certificate of Ownership of the said two parcels of land." The the contrary, a real and factual sale is evident in paragraph 6
mortgage provisions in paragraphs 6 and 7 of the agreement thereof, which states: "That the Nasipit Lumber Co., Inc., . . . is
state that the P7,000.00 and P5,000.00 were "earnest money or a very much interested in acquiring the land covered by the
loan with antichresis by the free occupancy and use given to aforecited application to be used for purposes of mechanized,
Nasipit of the 140 hectares of land not anymore as a lessee." If farming" and the penultimate paragraph stating: ". . . VICENTE J.
the agreement to sell transferred ownership to Nasipit, then why VILLAFLOR, hereby voluntarily renounce and relinquish whatever
was it necessary to require petitioner, in a second agreement, to rights to, and interests I have in the land covered by my above-
mortgage his property in the event of nonfulfillment of the mentioned application in favor of the Nasipit Lumber Co., Inc."
prestations in the first agreement?
We also hold that no simulation is shown either in the letter, dated
True, the agreement to sell did not absolutely transfer ownership December 3, 1973, of the former field manager of private
of the land to private respondent. This fact, however, does not respondent, George Mear. A pertinent portion of the letter reads:
show that the agreement was simulated. Petitioner's delivery of
the Certificate of Ownership and execution of the deed of (a)s regards your property at Acacia, San Mateo, I recall
absolute sale were suspensive conditions, which gave rise to a that we made some sort of agreement for the occupancy,
corresponding obligation on the part of the private but I no longer recall the details and I had forgotten
respondent, i.e., the payment of the last installment of the whether or not we actually did occupy your land. But if, as
consideration mentioned in the December 7, 1948 Agreement. you say, we did occupy it, then I am sure that the
Such conditions did not affect the perfection of the contract or Company is obligated to pay a rental.
prove simulation. Neither did the mortgage.
The letter did not contain any express admission that private
Simulation occurs when an apparent contract is a declaration of a respondent was still leasing the land from petitioner as of that
fictitious will, deliberately made by agreement of the parties, in date. According to Mear, he could no longer recall the details of
order to produce, for the purpose of deception, the appearance of his agreement with petitioner. This cannot be read as evidence of
a juridical act which does not exist or is different from that which the simulation of either the deed of relinquishment or the
was really executed.40 Such an intention is not apparent in the
agreements to sell. It is evidence merely of an honest lack of demand "payment, orally or in writing, of the five thousand (P5,000.00)
recollection. pesos which was supposed to be due him since August 17, 1950, the date
when the order of award was issued to Nasipit, and when his cause of action
to recover payment had accrued." Nonpayment of the consideration in the
Petitioner also alleges that he continued to pay realty taxes on contracts to sell or the deed of relinquishment was raised for the first time in
the land even after the execution of said contracts. This is the protest filed with the Bureau of Lands on January 31, 1974. But this
immaterial because payment of realty taxes does not necessarily protest letter was not the demand letter required by law.
prove ownership, much less simulation of said contracts.41
Petitioner alleges that the assignment of credit and the letter of the former
Nonpayment of the Consideration field manager of private respondent are contemporaneous and subsequent
Did Not Prove Simulation acts revealing the nonpayment of the consideration. He maintains that the
P12,000.00 credit assigned pertains to the P5,000.00 and P7,000.00 initial
payments in the December 7, 1948 Agreement, because the balance of
Petitioner insists that nonpayment of the consideration in the contracts P12,000.00 was not yet "due and accruing." This is consistent, he argues,
proves their simulation. We disagree. Nonpayment, at most, gives him only with the representation that private respondent was not interested in filing a
the right to sue for collection. Generally, in a contract of sale, payment of the sales application over the land in issue and that Nasipit was instead
price is a resolutory condition and the remedy of the seller is to exact supporting petitioner's application thereto in Mear's letter to the Director of
fulfillment or, in case of a substantial breach, to rescind the contract under Lands dated February 22, 1950 (Exh. "X") 47
Article 1191 of the Civil Code. However, failure to pay is not even a breach,
42
but merely an event which prevents the vendor's obligation to convey title
from acquiring binding force. 43 This argument is too strained to be acceptable. The assignment of credit did
not establish the nondelivery of these initialpayments of the total
consideration. First, the assignment of credit happened on January 19,
Petitioner also argues that Respondent Court violated evidentiary rules in 1949, or a month after the signing of the December 7, 1948 Agreement and
upholding the ruling of the Director of Lands that petitioner did not present almost six months after the July 7, 1948 Agreement to Sell. Second, it does
evidence to show private respondent's failure to pay him. We disagree. Prior not overcome the recitation in the Agreement of December 7, 1948: ". . . a)
to the amendment of the rules on evidence on March 14, 1989, Section 1, The amount of SEVEN THOUSAND (P7,000.00) PESOS has already been
Rule 131, states that each party must prove his or her own affirmative paid by the Second Party to the First Party upon the execution of the
allegations. Thus, the burden of proof in any cause rested upon the party
44
Agreement to Sell, on July 7, 1948; b) The amount of FIVE THOUSAND
who, as determined by the pleadings or the nature of the case, asserts the (P5,000.00) PESOS shall be paid upon the signing of this present
affirmative of an issue and remains there until the termination of the agreement; . . . . "
action. Although nonpayment is a negative fact which need not be proved,
45
the party seeking payment is still required to prove the existence of the debt
and the fact that it is already due. 46 Aside from these facts, the Director of Lands found evidence of greater
weight showing that payment was actually made: 48
Petitioner showed the existence of the obligation with the presentation of the
contracts, but did not present any evidence that he demanded payment from . . . (T)here is strong evidence to show that said . . . (P12,000.00)
private respondent. The demand letters dated January 2 and 5, 1974 (Exhs. had been paid by NASIPIT to Edward J. Nell Company by virtue of
"J" and "U"), adduced in evidence by petitioner, were for the payment of the Deed of Assignment of Credit executed by Villaflor (Exh. "41
back rentals, damages to improvements and reimbursement of acquisition NALCO") for the credit of the latter.
costs and realty taxes, not payment arising from the contract to sell.
Atty. Gabriel Banaag, resident counsel of NASIPIT . . . declared
Thus, we cannot fault Respondent Court for adopting the finding of the that it was he who notarized the "Agreement to Sell" (Exh. "F"); . . .
Director of Lands that petitioner "offered no evidence to support his claim of that subsequently, in January 1949, Villaflor executed a Deed of
nonpayment beyond his own self-serving assertions," as he did not even Assignment of credit in favor of Edward J. Nell Company (Exh. "41
NALCO") whereby Villaflor ceded to the latter his receivable for information as to what was transpiring in his
NASIPIT corresponding to the remaining balance in the amount of . affairs in Manila . . . .
. . (P12,000.00) . . . of the total consideration . . . . ; He further
testified that the said assignment . . . was communicated to Second, it should be understood that the condition that NASIPIT
NASIPIT under cover letter dated January 24, 1949 (Exh. "41-A") should reimburse Villaflor the amount of Five Thousand
and not long thereafter, by virtue of the said assignment of credit, (P5,000.00) Pesos upon its receipt of the order of award was
NASIPIT paid the balance . . . to Edward J. Nell Company (p. fulfilled as said award was issued to NASIPIT on August 17, 1950.
58, ibid). Atty. Banaag's aforesaid testimony stand unrebutted; The said deed of relinquishment was prepared and notarized in
hence, must be given full weight and credit. Manila with Villaflor and NASIPIT signing the instrument also in
Manila. Now, considering that Villaflor is presumed to be more
xxx xxx xxx assiduous in following up with the Bureau of Lands the expeditious
issuance of the order of award as the (consideration) would depend
The Director of Lands also found that there had been payment of the on the issuance of said order to award NASIPIT, would it not be
consideration in the relinquishment of rights:
49 reasonable to believe that Villaflor was at hand when the award
was issued to NASIPIT on August 17, 1950, or barely a day which
he executed the deed of relinquishment on August 16, 1950, in
On the other hand, there are strong and compelling reasons to Manila? . . . .
presume that Villaflor had already been paid the amount of Five
Thousand (P5,000.00) Pesos.
Third, on the other hand, NASIPIT has in his possession a sort of
"order" upon itself — (the deed of relinquishment wherein he(sic)
First, . . . What is surprising, however, is not so much his claims obligated itself to reimburse or pay Villaflor the . . . consideration of
consisting of gigantic amounts as his having forgotten to adduce the relinquishment upon its receipt of the order of award) for the
evidence to prove his claim of non-payment of the Five Thousand payment of the aforesaid amount the moment the order of award is
(P5,000.00) Pesos during the investigation proceedings when he issued to it. It is reasonable to presume that NASIPIT has paid the
had all the time and opportunity to do so. . . . . The fact that he did (consideration) to Villaflor.
not adduce or even attempt to adduce evidence in support thereof
shows either that he had no evidence to offer of that NASIPIT had
already paid him in fact. What is worse is that Villaflor did not even xxx xxx xxx
bother to command payment, orally or in writing, of the Five
Thousand (P5,000.00) Pesos which was supposed to be due him . . . (I)t was virtually impossible for NASIPIT, after the lapse of the
since August 17, 1950, the date when the order of award was intervening 24 years, to be able to cope up with all the records
issued to Nasipit, and when his cause of action to recover payment necessary to show that the consideration for the deed of
had accrued. The fact that he only made a command for payment relinquishment had been fully paid. To expect NASIPIT to keep
on January 31, 1974, when he filed his protest or twenty-four (24) intact all records pertinent to the transaction for the whole quarter of
years later is immediately nugatory of his claim for non-payment. a century would be to require what even the law does not. Indeed,
even the applicable law itself (Sec. 337, National Internal Revenue
But Villaflor maintains that he had no knowledge or notice that the Code) requires that all records of corporations be preserved for
order of award had already been issued to NASIPIT as he had only a maximum of five years.
gone to Indonesia and he had been absent from the Philippines
during all those twenty-four (24) years. This of course taxes NASIPIT may well have added that at any rate while there are
credulity. . . . transactions where the proper evidence is impossible or extremely
difficult to produce after the lapse of time . . . the law creates
. . . It is more in keeping with the ordinary course presumptions of regularity in favor of such transactions (20 Am. Jur.
of things that he should have acquired 232) so that when the basic fact is established in an action the
existence of the presumed fact must be assumed by force of law. Act are: (1) the possession of the qualifications required by said Act (under
(Rule 13, Uniform Rules of Evidence; 9 Wigmore, Sec. 2491). Section 29) and (2) the lack of the disqualifications mentioned therein (under
Sections 121, 122, and 123). However, the transfer of ownership via the two
The Court also notes that Mear's letter of February 22, 1950 was sent six agreements dated July 7 and December 7, 1948 and the relinquishment of
months prior to the execution of the deed of relinquishment of right. At the rights, being private contracts, were binding only between petitioner and
time of its writing, private respondent had not perfected its ownership of the private respondent. The Public Land Act finds no relevance because the
land to be able to qualify as a sales applicant. Besides, although he was a disputed land was covered by said Act only after the issuance of the order of
party to the July 7, 1948 Agreement to Sell, Mear was not a signatory to the award in favor of private respondent. Thus, the possession of any
Deed of Relinquishment or to the December 7, 1948 Agreement to Sell. disqualification by private respondent under said Act is immaterial to the
Thus, he cannot be expected to know the existence of and the amendments private contracts between the parties thereto. (We are not, however,
to the later contracts. These circumstances explain the mistaken suggesting a departure from the rule that laws are deemed written in
representations, not misrepresentations, in said letter. contracts.) Consideration of said provisions of the Act will further show their
inapplicability to these contracts. Section 121 of the Act pertains to
acquisitions of public land by a corporation from a grantee, but petitioner
Lack of Notice of the Award never became a grantee of the disputed land. On the other hand, private
respondent itself was the direct grantee. Sections 122 and 123 disqualify
Petitioner insists that private respondent suppressed evidence, pointing to corporations, which are not authorized by their charter, from acquiring public
his not having been notified of the Order of Award dated August 17, land; the records do not show that private respondent was not so authorized
1950. At the bottom of page 2 of the order, petitioner was not listed as one
50
under its charter.
of the parties who were to be furnished a copy by Director of Lands Jose P.
Dans. Petitioner also posits that Public Land Inspector Sulpicio A. Taeza Also, the determination by the Director of Lands and the Minister of Natural
irregularly received the copies for both private respondent and the city Resources of the qualification of private respondent to become an awardee
treasurer of Butuan City. The lack of notice for petitioner can be easily or grantee under the Act is persuasive on Respondent Court. In Espinosa
explained. Plainly, petitioner was not entitled to said notice of award from the vs.Makalintal, the Court ruled that, by law, the powers of the Secretary of
53
Director of Lands, because by then, he had already relinquished his rights to Agriculture and Natural Resources regarding the disposition of public lands
the disputed land in favor of private respondent. In the heading of the order, — including the approval, rejection, and reinstatement of applications — are
he was referred to as sales applicant-assignor. In paragraph number 4, the of executive and administrative nature. (Such powers, however, do not
order stated that, on August 16, 1950, he relinquished his rights to the land include the judicial power to decide controversies arising from
subject of the award to private respondent. From such date, the sales disagreements in civil or contractual relations between the litigants.)
application was considered to be a matter between the Bureau of Lands and Consequently, the determination of whether private respondent is qualified
private respondent only. Considering these facts, the failure to give petitioner to become an awardee of public land under C.A. 141 by sales application is
a copy of the notice of the award cannot be considered as suppression of included therein.
evidence. Furthermore, this order was in fact available to petitioner and had
51
been referred to by him since January 31, 1974 when he filed his protest
with the Bureau of Lands. 52 All told, the only disqualification that can be imputed to private respondent is
the prohibition in the 1973 Constitution against the holding of alienable lands
of the public domain by corporations. However, this Court earlier settled the
54
Third Issue: Private Respondent Qualified matter, ruling that said constitutional prohibition had no retroactive effect and
for an Award of Public Land could not prevail over a vested right to the land. In Ayog vs.Cusi, Jr., this
55
Court declared:
Petitioner asserts that private respondent was legally disqualified from
acquiring the parcels of land in question because it was not authorized by its We hold that the said constitutional prohibition has no retroactive
charter to acquire disposable public agricultural lands under Sections 121, application to the sales application of Biñan Development Co., Inc.
122 and 123 of the Public Land Act, prior to its amendment by P.D. No. 763. because it had already acquired a vested right to the land applied
We disagree. The requirements for a sales application under the Public Land for at the time the 1973 Constitution took effect.
That vested right has to be respected. It could not be abrogated by In Opinion No. 185, series of 1976, Secretary Abad Santos held
the new Constitution. Section 2, Article XIII of the 1935 Constitution that where the cultivation requirements were fulfilled before the new
allows private corporations to purchase public agricultural lands not Constitution took effect but the full payment of the price was
exceeding one thousand and twenty-four hectares. Petitioner's completed after January 17, 1973, the applicant was, nevertheless,
prohibition action is barred by the doctrine of vested rights in entitled to a sales patent (p. 256, Rollo).
constitutional law.
Such a contemporaneous construction of the constitutional
"A right is vested when the right to enjoyment has become the prohibition by a high executive official carries great weight and
property of some particular person or persons as a present should be accorded much respect. It is a correct interpretation of
interest." (16 C.J.S. 1173). It is "the privilege to enjoy property section 11 of Article XIV.
legally vested, to enforce contracts, and enjoy the rights of property
conferred by existing law" (12 C.J. 955, Note 46, No. 6) or "some In the instant case, it is incontestable that prior to the effectivity of
right or interest in property which has become fixed and established the 1973 Constitution the right of the corporation to purchase the
and is no longer open to doubt or controversy" (Downs vs. Blount, land in question had become fixed and established and was no
170 Fed. 15, 20, cited in Balboa vs. Farrales, 51 Phil. 498, 502). longer open to doubt or controversy.
The due process clause prohibits the annihilation of vested rights. Its compliance with the requirements of the Public Land Law for the
"A state may not impair vested rights by legislative enactment, by issuance of a patent had the effect of segregating the said land
the enactment or by the subsequent repeal of a municipal from the public domain. The corporation's right to obtain a patent
ordinance, or by a change in the constitution of the State, except in for that land is protected by law. It cannot be deprived of that right
a legitimate exercise of the police power" (16 C.J.S. 1177-78). without due process (Director of Lands vs. CA, 123 Phil. 919).
It has been observed that, generally, the term "vested right" The Minister of Natural Resources ruled, and we agree, that private
expresses the concept of present fixed interest, which in right respondent was similarly qualified to become an awardee of the disputed
reason and natural justice should be protected against arbitrary land because its rights to it vested prior to the effectivity of the 1973
State action, or an innately just an imperative right which an Constitution:
56
a. the land The same finding was earlier made by the Director of Lands: 57
covered
thereby was It is further contended by Villaflor that Nasipit has no juridical
awarded; personality to apply for the purchase of public lands for agricultural
purposes. The records clearly show, however, that since the
b. cultivation execution of the deed of relinquishment of August 16, 1950, in favor
requirements of Nasipit, Villaflor has always considered and recognized Nasipit
of law were as having the juridical personality to acquire public lands for
complied agricultural purposes. In the deed of relinquishment . . . , it is
with as stated:
shown by
investigation 6. That the Nasipit Lumber Co., Inc., a
reports corporation duly organized in accordance with
submitted the laws of the Philippines, . . . .
prior to
January 17, Even this Office had not failed to recognize the juridical personality
1973; of Nasipit to apply for the purchase of public lands . . . when it
awarded to it the land so relinquished by Villaflor (Order of Award
c. land was dated August 17, 1950) and accepted its application therefor. At
surveyed any rate, the question whether an applicant is qualified to apply for
and survey the acquisition of public lands is a matter between the applicant and
returns this Office to decide and which a third party like Villaflor has no
already personality to question beyond merely calling the attention of this
submitted to Office thereto.
Needless to say, we also agree that the November 8, 1946 Lease In 1946, petitioner entered into a lease agreement with
Agreement between petitioner and private respondent had been terminated
by the agreements to sell and the relinquishment of rights. By the time the respondent Nasipit Lumber Co.Inc. However, an
verbal leases were allegedly made in 1951 and 1955, the disputed land had
58
“Agreement for the Relinquishment of Rights” was
already been acquired and awarded to private respondent. In any event,
petitioner's cause of action on these alleged lease agreements prescribed
entered into by both parties in 1950. The respondent
long before he filed Civil Case No. 2072-III, as correctly found by the trial having complied all the requirements agreed upon,
and appellate courts. Thus, it is no longer important, in this case, to pass
59
assumed ownership and possession of the property
upon the issue of whether or not amendments to a lease contract can be
proven by parol evidence. The same holds true as regards the issue of since then. Respondent corporation likewise filed a
forum-shopping. sales application in 1950 over the property to bolster
his claim which the Bureau of Land otherwise granted
All in all, petitioner has not provided us sufficient reason to disturb the
cogent findings of the Director of Lands, the Minister of Natural Resources,
on the same year as proof of an “Order of Award”
the trial court and the Court of Appeals. issued.
In 1974 or twenty four (24) years had passed, when
WHEREFORE, the petition is hereby DISMISSED. petitioner, questioned and made several collateral and
extraneous claims against the respondent. However,
SO ORDERED.
the Bureau of Lands dismissed the claim, arguing that
VICENTE VILLAFLOR, substituted by his heirs, petitioner no longer has any substantial rights to
petitioner, question the validity of acquisition of the respondent
vs. and the subsequent issuance of free patent by the
COURT OF APPEALS and NASIPIT LUMBER CO., Bureau of Lands. Unperturbed, petitioner filed a motion
INC., respondents. for reconsideration at the Ministry of Natural Resources
G.R. No. 95694 October 9, 1997 which likewise dismissed the petition.
Facts:
On July 6, 1978, petitioner filed a complaint in the trial
The Petitioner bought a large tract of land containing
court for “Declaration of Nullity of Contract ( Deed of
one hundred forty (140) hectares to four (4) different
Relinquishment of Rights), Recovery of Possession (of
owners in 1940. The land was part of the public
two parcels of land subject of the contract), and
domain, but the petitioners predecessor in interest over
Damages” at about the same time that he appealed the
which he acquired the property, have been in open,
decision of the Minister of Natural Resources to the
exclusive and notorious possession of the same for
Office of the President. On January 28, 1983, petitioner
sometime. After acquisition, petitioner asserts
died. Petitioner’s heir substituted in his behalf to
exclusive rights thereof for more than fifty (50) years.
pursue the claim. The trial court in Butuan City who
initially take cognizance of the case ordered the case
dismissed, on the grounds that: (1) petitioner admitted fees appurtenant to the sale of the land. He
the due execution and genuineness of the contract and participated in the public auction where he was
was estopped from proving its nullity, (2) the verbal declared the successful bidder. He had fully paid the
lease agreements were unenforceable under Article purchase price thereof. It would be a height of
1403 (2) (e) of the Civil Code, and (3) his causes of absurdity for Villaflor to be buying that which is owned
action were barred by extinctive prescription and/or by him if his claim of private ownership thereof is to be
laches. believed. The area in dispute is not the private property
of the petitioner.
The heirs appealed to the CA which likewise rendered
judgment of dismissal by upholding the lower court’s It is a basic assumption of public policy that lands of
ruling. whatever classification belong to the state. Unless
alienated in accordance with law, it retains its rights
ISSUE: over the same as dominus. No public land can be
Whether or not the sale is valid. acquired by private persons without any grant, express
or implied from the government. It is indispensable
HELD: then that there be showing of title from the state or any
No. The provision of the law is specific that public other mode of acquisition recognized by law. Such
lands can only be acquired in the manner provided for sales applicant manifestly acknowledged that he does
therein and not otherwise(Sec. 11, CA. No. 141, as not own the land and that the same is a public land
amended). In his sales application, petitioner expressly under the administration of the Bureau of Lands, to
admitted that said property was public land. This is which the application was submitted, all of its acts prior
formidable evidence as it amounts to an admission thereof, including its real estate tax declarations,
against interest. The records show that Villaflor had characterized its possessions of the land as that of a
applied for the purchase of lands in question with this “sales applicant”. And consequently, as one who
Office (Sales Application V-807) on 2 December 1948. expects to buy it, but has not as yet done so, and is
There is a condition in the sales application to the not, therefore, its owner.
effect that he recognizes that the land covered by the
same is of public domain and any and all rights he may The rule on the interpretation of contracts (Article
have with respect thereto by virtue of continuous 1371) is used in affirming, not negating, their validity.
occupation and cultivation are relinquished to the Article 1373,which is a conjunct of Article 1371,
Government of which Villaflor is very much aware. It provides that, if the instrument is susceptible of two or
also appears that Villaflor had paid for the publication more interpretations, the interpretation which will make
it valid and effectual should be adopted. In this light, it The requirements for a sales application under the
is not difficult to understand that the legal basis urged Public Land Act are: (1) the possession of the
by petitioner does not support his allegation that the qualifications required by said Act (under Section 29)
contracts to sell and the deed of relinquishment are and (2) the lack of the disqualifications mentioned
simulated and fictitious. Simulation occurs when an therein (under Sections 121, 122,and 123). Section
apparent contract is a declaration of a fictitious will, 121 of the Act pertains to acquisitions of public land by
deliberately made by agreement of the parties, in order a corporation from a grantee: The private respondent,
to produce, for the purpose of deception, the not the petitioner, was the direct grantee of the
appearance of a juridical act which does not exist or is disputed land. Sections 122 and 123 disqualify
different from that which was really executed. Such an corporations, which are not authorized by their charter,
intention is not apparent in the agreements. The intent from acquiring public land; the records do not show
to sell, on the other hand, is as clear as daylight. The that private respondent was not so authorized under its
fact, that the agreement to sell (7 December 1948) did charter.
not absolutely transfer ownership of the land to private
respondent, does not how that the agreement was
simulated. Petitioner‟s delivery of the Certificate of
SECOND DIVISION
Ownership and execution of the deed of absolute sale
were suspensive conditions, which gave rise to a G.R. No. L-33146 May 31, 1977
corresponding obligation on the part of the private
respondent, i.e., the payment of the last installment of
THE COMMISSIONER OF CUSTOMS, and THE
the consideration mentioned in the Agreement. Such
COLLECTOR OF CUSTOMS, petitioners,
conditions did not affect the perfection of the contract
vs.
or prove simulation Nonpayment, at most, gives the
HON. PEDRO C. NAVARRO, Judge of the Court
vendor only the right to sue for collection. Generally, in
a contract of sale, payment of the price is a resolutory of First Instance of Rizal, Branch II (Pasig, Rizal),
condition and the remedy of the seller is to exact and JUANITO S. FLORES, doing business under
fulfillment or, in case of a substantial breach, to rescind the name and style of JS. F. ENTERPRISES and
the contract under Article 1191 of the Civil Code. ASIATIC INCORPORATED, represented by
However, failure to pay is not even a breach, but EUGENIO VILLANUEVA, respondents.
merely an event which prevents the vendor‟s
Solicitor General Felix Q. Antonio, Assistant Solicitor
obligation to convey title from acquiring binding force. General Conrado T. Limcaoco, Solicitor Jaime M.
Lantin and Special Attorney Vicente M. Asuncion for study of the merit of the case, the respondents have decided to
abandon its interest in the case." 4 The rationale behind such a move
petitioner. was ostensibly the desire to avoid additional expenses, in view of the
fact that "the shipments, being perishable, have already
Ledesma, Saludo & Associates for private deteriorated." 5 It is difficult to avoid the suspicion that the real
respondent. reason was that the points of law raised by petitioners could not be
refuted. Private respondents concluded with a statement of "their
intention of not filing an answer to the instant petition and respectfully
[submitting] the case on the basis of the pleadings made before the
lower court. " 6
FERNANDO, J.:
It does not require too much of an effort then to
The stress, and rightly so, by the Commissioner of ascertain the applicable legal principles that should
Customs and the Collector of Customs in their govern. The inescapable conclusion is that the
exhaustive and scholarly petition for certiorari, filed petition possesses merit. certiorari lies.
on February 11, 1971, was on the jurisdictional
issue. It sought to nullify and set aside order 1 of 1. The question of seizure and forfeiture is for the
respondent Judge Pedro C. Navarro 2 dated January 4, 1971, administrative in the first instance and then the
issuing a writ of preliminary injunction as prayed for by private
respondents Juanito S. Flores and Asiatic Incorporated the importers
Commissioner of Customs. This is a field where the
of 1,350 cartons of fresh fruits, restraining petitioners from doctrine of primary jurisdiction controls. Thereafter
proceeding with the auction sale of such perishable goods. Classified an appeal may be taken to the Court of Tax Appeals.
as non-essential consumer commodities, they were banned by A court of first instance is thus devoid of competence
Central Bank Circulars Nos. 289, 294 and 295 as prohibited
importation or importation contrary to law and thus made subject to to act on the matter. There is further judicial review,
forfeiture proceedings by petitioner Collector of Customs pursuant to but only by this Court in the exercise of its certiorari
the relevant sections of the Tariff and Customs Code.3 In a detailed jurisdiction. More specifically, in Pascual v.
and specific fashion, petitioners pointed out how violative was the
assumption of jurisdiction by respondent Judge over an incident of a
Commissioner of Customs,7 a 1959 decision, this Court
affirmed a judgment of the Court of Tax Appeals and categorically
pending seizure and forfeiture proceeding which, as held in a
announced that respondent Commissioner of Customs could "seize
number of decisions, was a matter falling within the exclusive
[the importation of goods lacking the release certificates of the
competence of the customs authorities. The persuasive character of
Central Bank] and order their forfeiture under the [appropriate]
the petition is thus evident, resulting in this Court issuing on February
15, 1971 a resolution requiring respondents to file an answer and at provisions of the Revised Administrative Code." 8 Such a doctrine
the same time issuing a writ of preliminary injunction as prayed for by was reiterated in Commissioner of Customs v. Serree Investment
petitioners to prevent the challenged order of respondent Judge from Company;9 Commissioner of Customs v. Eastern Sea Trading
being implemented. Instead of preparing an answer, they just Co.;10 Commissioner of Customs v. Santos;11 Commissioner of
submitted a manifestation stating that "after an intensive and serious Customs v. Nepomuceno;12 Pascual v. Commissioner of
Customs;13 Serree Investment Co. v. Commissioner of the customs laws, from the moment the goods are actually in its
Customs;14 Bombay Dept. Store v. Commissioner of possession or control, even if no warrant of seizure or detention had
Customs;15Yupangco and Sons v. Collector of Customs;16 Chan previously been issued by the Collector of Customs in connection
Kian v. Collector of Customs;17 Capulong v. Aseron;18 Lazaro v. with seizure and forfeiture proceedings. In the present case, the
Bureau of Customs actually seized the goods in question on
Commissioner of Customs;19 Capulong v. Acting Commissioner of
November 4, 1966, and so from that date the Bureau of Customs
Customs;20 Gigare v. Commissioner of Customs.21 acquired jurisdiction over the goods for the purposes of the
enforcement of the tariff and customs laws, to the exclusion of the
That such jurisdiction of the customs authorities is regular courts. Much less then would the Court of First Instance of
exclusive was made clear in Pacis v. Averia,22 decided Manila have jurisdiction over the goods in question after the Collector
in 1966. This Court, speaking through Justice J. P. Bengzon, of Customs had issued the warrant of seizure and detention on
realistically observed: "This original jurisdiction of the Court of First January 12, 1967, And so, it cannot be said, as respondents
Instance, when exercised in an action for recovery of personal contend, that the issuance of said warrant was only an attempt to
property which is a subject of a forfeiture proceeding in the Bureau of divest the respondent Judge of jurisdiction over the subject matter of
Customs, tends to encroach upon, and to render futile, the the case. The court presided by respondent Judge did not acquire
jurisdiction of the Collector of Customs in seizure and forfeiture jurisdiction over the goods in question when the petition for
mandamus was filed before it, and so there was no need of divesting
proceedings."23 The court "should yield to the jurisdiction of the
it of jurisdiction. Not having acquired jurisdiction over the goods, it
Collector of Customs."24 Such a ruling, as pointed out by Justice follows that the Court of First Instance of Manila had no jurisdiction to
Zaldivar in Auyong Hian v. Court of Tax Appeals,25 promulgated less issue the questioned order of March 7, 1967 releasing said
than a year later, could be traced to Government v. Gale,26 a 1913 goods."31 Lopez v. Commissioner of Customs,32 as well as Luna v.
decision, where there was a recognition in the opinion of Justice Pacis,33 both 1971 decisions, speak to the same effect. The latest
Carson that a Collector of Customs when sitting in forfeiture categorical declaration of such a rule appears in the opinion of
proceedings constitutes a tribunal upon which the law expressly
Justice Teehankee, speaking for the Court, in Seneres v. Frias 34 in
confers jurisdiction to hear and determine all questions touching the
these words: "It is the settled law and jurisprudence in this
forfeiture and further disposition of the subject matter of such
jurisdiction that the customs authorities acquire exclusive jurisdiction
proceedings.27 over goods sought to be imported into the Philippines, for the
purpose of enforcement of Philippine customs laws, from the
The controlling principle was set forth anew in Ponce moment the goods are actually under their possession and control,
Enrile v. Vinuya,28 decided in 1971. Thus: "The prevailing even if no warrant for seizure or detention thereof has previously
doctrine is that the exclusive jurisdiction in seizure and forfeiture been issued by the port collector of customs."35
cases vested in the Collector of Customs precludes a court of first
instance from assuming cognizance over such a 2. The petition did not ignore the due process aspect
matter."29 Reference was then made in the opinion to previous which appeared to have bothered respondent Judge.
cases.30Then it continued: "Papa v. Mago likewise deserves to be
cited. The opinion of Justice Zaldivar for the Court emphatically
It was pointed out that in ordering the sale at public
asserted the doctrine anew in the following language: 'It is the settled auction of the fruits in question, considering their
rule, therefore, that the Bureau of Customs acquires exclusive perishable character, petitioners acted in accordance
jurisdiction over imported goods, for the purposes of enforcement of with section 2607 of the Tariff and Customs Code.
Insofar as pertinent, it reads: "When seizure shall be 3. The petition likewise took pains to point out that
made of property which, in the opinion of the the reliance by respondent Judge on Commissioner
Collector, is liable to perish or be wasted or to of Customs v. Alikpala 37 was misplaced. In that 1970
depreciate greatly in value by keeping, or which decision, this Court, recognizing that the judiciary in the Philippines is
vested with both legal and equitable powers, did not deem it proper
cannot be kept without great disproportionate to set aside an injunction issued by the lower court addressed to the
expense, whether such property consists of live customs authorities to stop the sale at public auction of imported
animals or of any article, the appraiser shall be fruits. There was thus a semblance of similarity. A closer
examination would reveal that the analogy is more apparent than
certify in his appraisal, then the Collector may real. The case could be easily distinguished. All that is necessary is
proceed to advertise and sell the same of auction, to refer to the opinion of former Chief Justice Makalintal in the
upon notice as he shall deem to be Alikpala decision: "The warrants of seizure were issued in view of
reasonable." 36 There was a literal adherence to the procedure Central Bank Circulars Nos. 294 and 295, promulgated on March 10
above set forth. The proper advertisement to sell the perishable and 20, 1970, respectively, which provide that 'no- dollar imports not
goods of auction was made. That was the notice required by the covered by Circular No. 247 shall not be issued any release
statute. Private respondents as the importers could not have been certificates and shall be referred to the Central Bank for official
unaware that such step was contemplated. The law expects them to transmittal to the Bureau of Customs for appropriate seizure
have that requisite degree of interest in what was happening. There proceedings. Evidently, in the opinion of the Collector of Customs
is nothing unreasonable in such an assumption. It would be futile to himself, even in the light of those circulars there exists no legal
assert therefore that there was a denial of due process unless the impediment to the release of the subject importations under bond,
above section is considered null precisely on that ground. No attempt otherwise he would not have agreed thereto, although he changed
was made by private respondents to impugn its validity. Perhaps it is his requirement from surety bond to cash. In any case, as pointed
because of the realization that it would be futile. There is nothing out by private respondents, the said importations had been ordered
arbitrary or unfair, the earmarks of a denial of due process, for the before Central Bank Circulars 294 and 295 were promulgated, and
Collector to order the sale at public auction upon notice as he shall since, the orders were made in accordance with previous practice
deem to be reasonable of a commodity in their nature perishable. there could be no bad faith or intent to violate those
That is the only way to safeguard during the pendency of a seizure circulars."38 Unfortunately, in this case respondent Judge missed
and forfeiture proceeding the rights of both the government and even those significant distinctions. The importation in question was clearly
the persons responsible for the importation. That way, if the illegality violative of the above Circulars Nos. 289, 294 and 295. Also
of the importation is not shown and forfeiture is not ordered, the petitioner Collector of Customs in this case was, in accordance with
proceeds could be turned over to the importer. If it were otherwise, law, definitely opposed to the release of the importation in question.
he would be deprived of property that is his, and that would be a He could not have authorized it without being held liable for violating
denial of due process. What negates any assertion of. such an the Tariff and Customs Code and the applicable doctrines of this
infringement of a constitutional right is the admitted and undeniable Court previously cited. It may be said further on this point that the
fact that the :Importation in question is banned by the applicable Alikpala decision is the only one of its kind and has not since been
Central Bank circulars. Petitioners therefore had no choice except to followed. As a matter of fact, the previously cited Seneres decision
proceed in accordance with the mandatory provisions of the did set aside a preliminary injunction issued by respondent Judge
Customs and Tariff Code. and did chide in vigorous and vehement language the assumption of
jurisdiction by the lower court when respect for the controlling
doctrines ought to have cautioned him against the issuance of a G.R. No. L-33146 May 31, 1977
preliminary injunction. In the even later case of Pacis v.
Geronimo,39 a writ of preliminary injunction likewise issued by the
respondent Judge in a pending seizure and forfeiture proceeding THE COMMISSIONER OF CUSTOMS, and THE
was annulled by this Court, again on the precise ground of manifest COLLECTOR OF CUSTOMS, petitioners,
lack of jurisdiction. The petition therefore did not exaggerate matters vs.
when it emphasized that respondent Judge, in issuing the writ of
preliminary injunction sought to be nullified, acted in a manner
HON. PEDRO C. NAVARRO,
contrary to and in violation of the law, assuming jurisdiction over a
matter beyond his competence.
Facts:
WHEREFORE, the writ of certiorari is granted and The Commissioner of Customs and the Collector of Customs in their
the order of respondent Judge of January 4, 1971 exhaustive and scholarly petition for certiorari, filed on February
nullified and set aside. The preliminary injunction 11, 1971, was on the jurisdictional issue. It sought to nullify and set
issued by this Court in its resolution of February 15, aside order of respondent Judge Pedro C. Navarro dated January 4,
1971 against the enforcement of the above order is 1971, issuing a writ of preliminary injunction as prayed for by
private respondents Juanito S. Flores and Asiatic Incorporated the
made permanent. Respondent Judge, or whoever is
importers of 1,350 cartons of fresh fruits, restraining petitioners
acting in his place and in his stead, is ordered to
from proceeding with the auction sale of such perishable goods.
dismiss Civil Case No. 14178 of Branch II of the Classified as non-essential consumer commodities, they were
Court of First Instance of Rizal, entitled Juanito S. banned by Central Bank Circulars Nos. 289, 294 and 295 as
Flores, doing business under the name and style prohibited importation or importation contrary to law and thus
of J.S.F. Enterprises and Asiatic Incorporated v. the made subject to forfeiture proceedings by petitioner Collector of
Commissioner of Customs and the Collector of Customs pursuant to the relevant sections of the Tariff and
Customs. Costs against private respondents. Customs Code.
In a detailed and specific fashion, petitioners pointed out how
violative was the assumption of jurisdiction by respondent Judge
over an incident of a pending seizure and forfeiture proceeding
which, as held in a number of decisions, was a matter falling within
the exclusive competence of the customs authorities. The
persuasive character of the petition is thus evident, resulting in
this Court issuing on February 15, 1971 a resolution requiring
respondents to file an answer and at the same time issuing a writ
of preliminary injunction as prayed for by petitioners to prevent
the challenged order of respondent Judge from being implemented.
Instead of preparing an answer, they just submitted a SECOND DIVISION
manifestation stating that "after an intensive and serious study of
the merit of the case, the respondents have decided to abandon its G.R. No. 132048 March 6, 2002
interest in the case.
HON. ANTONIO M. NUESA in his capacity as the
Issue: W/ON Custom has Jurisdiction Regional Director of DAR Region III and
RESTITUTO RIVERA,petitioners,
Held: Yes. risdiction of the customs authorities is exclusive was
vs.
made clear in Pacis v. Averia, decided in 1966. This Court, speaking
through Justice J. P. Bengzon, realistically observed: "This original
HON. COURT OF APPEALS (14th Div.), HON.
jurisdiction of the Court of First Instance, when exercised in an DEPARTMENT OF AGRARIAN REFORM
action for recovery of personal property which is a subject of a ADJUDICATION BOARD (DARAB) and JOSE
forfeiture proceeding in the Bureau of Customs, tends to encroach VERDILLO, respondents.
upon, and to render futile, the jurisdiction of the Collector of
Customs in seizure and forfeiture proceedings." The court "should QUISUMBING, J.:
yield to the jurisdiction of the Collector of Customs."
The controlling principle was set forth anew in Ponce Enrile v. This petition for review seeks to reverse the
Vinuya, decided in 1971. Thus: "The prevailing doctrine is that the decision1 dated December 19, 1997, of the Court of
exclusive jurisdiction in seizure and forfeiture cases vested in the Appeals which upheld the ruling of the Department of
Collector of Customs precludes a court of first instance from Agrarian Reform Adjudication Board or DARAB in
assuming cognizance over such a matter. favor of private respondent Jose Verdillo.
A return-to-work order was promptly issued by one of The pre-trail, however, was pre-empted by the
the petitioners, Regional Director Teofilo Gomez of petitioners when they filed with this Court a petition
the Department of Education, Culture and Sports for certiorari, prohibition and mandamus on 25 July
("DECS"), with a warning that if the "striking" school 1991 and so docketed as G.R. No. 100781.4 In a
teachers were not to resume their classes within resolution, dated 5 August 1991, the Court referred
twenty-four hours, administrative charges would be the petition to the Court of Appeals.
filed. Since the order was not heeded, administrative
complaints against the teachers concerned were On 6 May 1993, the Court of Appeals promulgated
thereupon filed. The teachers were each given five its assailed
days from receipt of said complaints within which to decision,5 denying the petition.
submit their respective answers and supporting
documents. An investigation panel, composed of In the instant appeal, the petitioners raise the same
three DECS lawyers (the other petitioners herein), issues that have heretofore been resolved by us in
namely, Marcelo Baclaso, Nieva Montes and the now decided case of "Vidad, et al. vs. RTC of
Generoso Capuyan, was constituted to look into the Negros Oriental, et al." and companion cases
case. aforementioned. There, we have ruled that it has
indeed been precipitate for the DECS officials to
Prior to the start of the hearings by the DECS seek the dismissal of the complaints filed in court by
Investigating Team, the private respondents filed the school teachers even as no restraining order
with the Regional Trial Court of Negros Oriental, could lawfully issue against the continuation of the
Branch 42, Dumaguete City, a complaint for administrative investigations. This Court has
injunction, prohibition and damages with prayer for rationalized, thus —
preliminary injunction. On 26 March 1991, the court a
quo issued the writ of preliminary injunction.
(1) There being no dispute that the root of the cases Accordingly, we here reiterate that the court a
filed before the court a quo deals on the performance quo did not err in denying petitioners' motion to
of official functions by the DECS officials, there dismiss the complaint in Civil Case No. 9884
cannot be a full determination on whether the actions although it did not commit error in issuing its
taken by them have been proper or improper, or restraining further proceedings on the administrative
whether they have acted in good faith or bad faith, investigation being conducted by DECS.
pending a full hearing that would give all the parties
a chance to ventilate their respective claims; WHEREFORE, the decision of 6 May 1993 of the
Court of Appeals is AFFIRMED insofar as it, in
(2) Public officials are not necessarily immune from effect, denied the dismissal of the complaint in Civil
damages in their personal capacities arising from Case No. 9884. The writ of preliminary injunction
acts done in bad faith, for if malice is indeed issued by the Regional Trial Court of Negros
established, public officials can no longer be said to Oriental, Branch 42, however, is hereby ordered
have acted within the scope of official authority so as DISSOLVED and its is DIRECTED to suspend
to still find protection under the mantle of immunity further hearings in said Civil Case No. 9884, until
for official actions; after a final determination on the administrative
proceedings would have been made. No costs.
(3) The issuance, however, of the restraining orders
by the lower court against further proceedings of the SO ORDERED.
administrative complaints is inappropriate inasmuch
as the authority of the DECS Regional Director to
issue the return to work memorandum, to initiate the
administrative charges, as well as to constitute the
investigating panel, can hardly be disputed; and
(1) In view of the foregoing, the Committee finds that Three days after, the Monetary Board adopted Resolution
there is no basis upon which to recommend No. 995, dated July 23, 1959, approving the appointment of
disciplinary action against respondent, and therefore herein respondent Mario Marcos to the position involved in
respectfully recommends that he be immediately place of petitioner R. Marino Corpus.
reinstated.
On August 18, 1959, petitioner filed a petition for certiorari,
Unable to agree with the committee report, the Monetary mandamus and quo warranto, with preliminary mandatory
Board adopted Resolution No. 957 on July 20, 1959 which injunction and damages, against the herein respondents.
considered "the respondent, R. Marino Corpus, resigned as The complaint, as amended, embodied four causes of
of the date of his suspension." The pertinent portion of the action, and the reliefs sought therein read as follows: .
resolution reads thus: .
1. Upon the FIRST CAUSE OF ACTION, to reinstate
After an exhaustive and mature deliberation of the petitioner immediately to the position of Special
report of the aforesaid fact finding committee, in Assistant in charge of the control of exports in
conjunction with the entire records of the case and conformity with the Final Report of the Investigating
Committee of May 5, 1959 and to declare that the 4. Upon the FOURTH CAUSE OF ACTION, to
action of the respondents per Monetary Resolution immediately reinstate petitioner to the position of
No. 957 is null and void, respondents having acted in Special Assistant in charge of the control of exports
connection with the same in excess of their and not to remove or molest him therefrom pending
jurisdiction and with grave and gross abuse of the determination of this case and, to this end, upon
discretion and authority; and for the purposes thereof petitioner's filing of a bond with sufficient sureties in
to order respondent Miguel Cuaderno, Sr., as an amount to be fixed by this Honorable Court, to
Governor of the Central Bank, to prepare an agenda issue a preliminary mandatory injunction
including therein as part of the business to be taken commanding respondents to do and/or refrain from
up by respondent Monetary Board petitioner's said doing the acts hereinabove referred to.
reinstatement;
Petitioner further prays for such other and further
2. Upon the SECOND CAUSE OF ACTION, to relief as may be just and equitable in the premises.
remove respondent Mario Marcos from the Office of
Special Assistant in charge of the Export Department The respondents filed their answer on September 4, 1959.
of the Central Bank, the same office to which Filemon Mendoza, a Central Bank employee, filed a petition
petitioner in possession of the same and to declare for intervention. The respondents and the intervenor filed
that the attempted appointment of the said separate motions to dismiss, against which an opposition
respondent Mario Marcos to the same is was filed by petitioner. On October 8, 1959, an order was
unwarranted and illegal, there being no vacancy in issued by the court below holding in abeyance the
the same as it has at all times been legally and resolution of the motions to dismiss until the trial, stating
physically filled by petitioner were it not for the that the grounds alleged therein do not appear to be
unlawful acts of respondents in ousting him indubitable. Subsequently, petitioner manifested in open
therefrom: .1äwphï1.ñët
court that he was abandoning his prayer for the issuance of
a preliminary mandatory injunction so that the case can be
3. Upon the THIRD CAUSE OF ACTION, to pay speedily terminated. On June 8, 1960, upon representations
petitioner the sums of P500,000.00 as moral of the respondents and intervenor, an order was issued
damages, P34,000.00 as salaries accrued and vacating the order of October 8, 1959 and ordering that "the
uncollected since March 18, 1958, plus those that Motions to Dismiss are deemed submitted anew for
may subsequently accrue, P20,000.00 as bonuses, resolution." On June 14, 1960, after several hearings,
overtime pay, equity pay and other allowances, another order was issued granting the motions to dismiss
which petitioner had failed to collect by reason of his the amended petition, on the ground that petitioner did not
unwarranted and unjustified suspension by exhaust all administrative remedies available to him in law.
respondents, P20,000.00 as attorney's fees plus the Petitioner filed a motion for reconsideration, which was
costs of this suit; denied in an order dated November 16, 1960. From said
order of June 14, 1960, dismissing the petition, and the (1) There is no law requiring an appeal to the President in a
order of November 16, 1960, denying the motion for case like the one at bar. The fact that the President had, in
reconsideration, petitioner has brought this appeal, claiming two instances cited in the orders appealed from, acted on
that the lower court erred: . appeals from decisions of the Monetary Board of the
Central Bank, should not be regarded as precedents, but at
1. In dismissing his petition for certiorari, most may be viewed as acts of condescension on the part
mandamus and quo warranto, with preliminary of the Chief Executive. (2) While there are provisions in the
mandatory injunction and damages; Civil Service Law regarding appeals to the Commissioner of
Civil Service and the Civil Service Board of Appeals, We
2. In not finding that the Monetary Board removed believe the petitioner is not bound to observe them,
him for a cause not provided by law, therefore, in considering his status and the Charter of the Central Bank.
violation of the Constitution; and . In Castillo vs. Bayona, et al., G.R. No. L-14375, January 13,
1960, We said that Section 14, Republic Act 265, creating
3. In not finding that the appointment of Mario P. the Central Bank of the Philippines, particularly paragraph
Marcos, the officer appointed by the respondent (c) thereof, "is sufficiently broad to vest the Monetary Board
Monetary Board to the position to which he was with the power of investigation and removal of its officials,
appointed, to have been made to a position that is except the Governor thereof. In other words, the Civil
not yet vacant. Service Law is the general legal provision for the
investigation, suspension or removal of civil service
The lower court was of the opinion that petitioner-appellant employees, whereas Section 14 is a special provision of law
should have exhausted all administrative remedies which must govern the investigation, suspension or removal
available to him, such as an appeal to the Commissioner of of employees of the Central Bank, though they may be
Civil Service, under Republic Act No. 2260, or the President subject to the Civil Service Law and Regulations in other
of the Philippines who under the Constitution and the law is respects." In this case, the respondent Monetary Board
the head of all the executive departments of the considered petitioner resigned from the office to which he
government including its agencies and instrumentalities. has been legally appointed as of the date of his suspension,
This is the main issue disputed in this appeal. after he has been duly indicted and tried before a
committee created by the Board for the purpose. An appeal
True, the appellant did not elevate his case for review either to the Civil Service Commission would thereby be an act of
by the President or the Civil Service Commission. However, supererogation, requiring the presentation of practically the
it is our opinion that a report to these administrative appeals same witnesses and documents produced in the
is voluntary or permissive, taking into account the facts investigation conducted at the instance of the Monetary
obtaining in this case. Board. Moreover, Section 16 (i) of the Civil Service Law
provides that "except as otherwise provided by law," the
Commissioner of Civil Service shall have "final authority to
pass upon the removal, separation and suspension of all Section 9 of said Rule 68 provides that the time for
permanent officials and employees in the competitive pleadings and proceedings may be shortened and the
or classified service and upon all matters relating to the action may be given precedence over any and other civil
conduct, discipline, and efficiency of such officials and business. Section 16 of the same Rule requires the filing of
employees; ...." Considering again the fact that the Charter the action against an officer for his ouster within one year
of the Central Bank provides for its own power, through the after the cause of such ouster. These judicial rules
Monetary Board, relative to the investigation, suspension or underscore the need for speed in the determination of
removal of its own employees except the Governor, coupled controversies to public offices (Remata vs. Javier, 37 Phil.
with the fact that petitioner has admitted that he belongs to 699; Tumulak vs. Egay, 82 Phil. 828). As was stated
the non-competitive or unclassified service, it is evident that in Pinullar vs. President of the Senate, G.R. No. L-11667,
an appeal by petitioner to the Commissioner of Civil Service June 30, 1958, the rationale is that the Government must
is not required or at most is permissive and voluntary. be immediately informed or advised if any person claims to
be entitled to an office or position in the civil service as
On the other hand, the doctrine does not apply against another actually holding it, so that the Government
where, by the terms or implications of the statute may not be faced with the predicament of having to pay two
authorizing an administrative remedy, such remedy salaries, one, for the person actually holding the office,
is permissive only, warranting the conclusion that the although illegally, and another, for one not actually
legislature intended to allow the judicial remedy even rendering service although entitled to do so (see also
though the administrative remedy has not been Madrid vs. Auditor General, supra).
exhausted (42 Am. Jur. 583).
Giving life and effect to these provisions, we have held
There is another reason. It must be remembered that the in Casin vs. Caluag, 45 Off. Gaz., Supp. No. 9, p. 379, that
amended petition is for certiorari, mandamus and quo a special civil action for quo warranto may be tried and
warranto.The allegations of the second cause of action of decided independently of a pending criminal case. In
the amended petition as above quoted sufficiently comply another case (Abeto vs. Rodas, 46 Off. Gaz. 930), we
with Section 7, Rule 63 of the Rules of Court on quo denied by resolution a supplemental motion for
warranto proceedings, which requires that "When the action reconsideration where the petitioner had contended that the
is against a person for usurping an office or franchise, the reglementary period of one year was suspended by the
complaint shall set forth the name of the person who claims order of the President exonerating him from certain
to be entitled thereto. If any, with an averment of his right to administrative charges because the petitioner "was justified
the same and that the defendant is unlawfully in possession in waiting for the President of the Philippines to reappoint
thereof." And the complaint was filed within the period of him as the logical and legal consequence of his
one year from the date of separation, pursuant to Section exoneration," and "only after considerable delay, when his
16 of the same Rule (Madrid vs. Auditor General, 58 Off. hopes failed, did petitioner institute the present
Gaz., January, 1962, pp. 41, 42-43). proceedings." Finally, in Torres vs. Quintos, G.R. No. L-
3304, April 5, 1951, we recalled the Abeto case, supra, by WHEREFORE, the orders under considerations are hereby
commenting therein that the denial of the motion for set aside and the record of the case is hereby ordered
reconsideration in that case had of course the effect of remanded to the trial court for further proceedings and
rejecting the theory that the pendency of an administrative judgment on the merits. No pronouncement as to costs.
remedy suspends the period within which a petition for quo
warranto should be filed, and we gave the reason thus:
The reason is obvious. While it may be desirable that Corpus vs Cuaderna Admin Law Digest
administrative remedies be first resorted to, no one Corpus vs Cuaderna, Sr.
is compelled or bound to do so; and as said
remedies neither are prerequisite to nor bar the GR No. L-17860, 30 March 1962
institution of quo warrantoproceedings, it follows that
he who claims the right to hold a public office 4 SCRA 749
allegedly usurped by another and who desires to
seek redress in the courts, should file the proper
judicial action within the reglementary period. As FACTS
emphasized in Bautista vs. Fajardo, 38 Phil. 624,
and Tumulak vs. Egay, 46 O.G. 3683, public interest While petitioner-appellant R. Marino Corpus was a Special
requires that the right to a public office should be Assistant to the Governor of the Central Bank, he was
determined as speedily as practicable. administratively charged which resulted in his suspension by the
Monetary Board of the Bank and the creation of a committee to
Upon the foregoing, we have to disagree with the legal investigate him. The committee found no basis on the complaint and
opinion of the trial judge and hold that the doctrine of recommended Corpus’ reinstatement. But the Board adopted
exhaustion of administrative remedies is inapplicable and Resolution No. 957 which considered Corpus resigned as of the date
does not bar the present proceedings. of his suspension. Petitioner filed with the trial court a petition for
certiorari, mandamus and quo warranto, with preliminary injunction
Considering the two views we have taken in the case, we and damages against respondents. The court a quo dismissed the
deem it unnecessary to pass upon the second and third petition on the ground that petitioner did not exhaust all
assignments of error which partially involve the evaluation administrative remedies available to him in law, such as an appeal to
of facts. The court below has started to receive the the Commissioner of Civil Service, under RA 2260, or the President
evidence, and it is better equipped and should be given the of the Philippines who, under the Constitution and the law, is the
chance to pass upon the credibility of the witnesses who head of all executive departments of the government including its
testified before it (Veraguth vs. Isabela Sugar Co., 57 Phil. agencies and instrumentalities.
266).
ISSUE FIRST DIVISION
Whether or not the doctrine of exhaustion of administrative
G.R. No. L-46218 October 23, 1990
remedies is applicable in this case
JOVENTINO MADRIGAL, petitioner-appellant,
vs.
HELD PROV. GOV. ARISTEO M. LECAROZ, VICE-GOVERNOR
CELSO ZOLETA, JR., PROVINCIAL BOARD MEMBERS
The Court held in the negative. The doctrine does not apply DOMINGO RIEGO AND MARCIAL PRINCIPE; PROV.
where, by the terms or implications of the statute authorizing an ENGR. ENRIQUE M. ISIDRO, ABRAHAM T. TADURAN
administrative remedy, such remedy is permissive only, warranting AND THE PROVINCE OF MARINDUQUE, respondents-
the conclusion that the legislature intended to allow the judicial appellees.
remedy even though the administrative remedy has not been
exhausted.
MEDIALDEA J.:
This case was certified to US by the Court of Appeals since it raises pure questions of law
(pp. 66-68, Rollo).
The issue raised in this case are certainly far from novel.
We shall, therefore, simply reiterate well established
jurisprudential rules on the prescriptive period within which
to file a petition for mandamus to compel reinstatement to a
government office and a claim for back salaries and
damages related thereto.
ACCORDINGLY, the appeal is hereby DENIED. The orders The pleadings and annexes filed by the parties disclose the
of the Court of First Instance of Marinduque dated March following factual and procedural backdrop of this case:
16, 1976 and April 27, 1976 are AFFIRMED.
On 29 October 1993, a complaint against the petitioners for
SO ORDERED. Grave Misconduct, Arbitrary Detention, and Dishonesty was
filed with the Office of the Commission on Human Rights in reconsideration of its decision. The petitioners received a
Tacloban City by private respondent Mario Valdez.5 The copy of this resolution on 26 January 1995.
complaint was referred to the Philippine National Police
Eighth Regional Command (PNP-RECOM 8) which, after Petitioners Cabada and De Guzman then filed with the
conducting its own investigation, filed an administrative Honorable Secretary of the DILG and Chairman of the
charge of Grave Misconduct against the petitioners and NAPOLCOM their "Appeal" 13 dated 5 February 1995 and
instituted summary dismissal proceedings. "Petition for Review" 14 dated 4 February 1995, respectively.
On 7 April 1994, the Regional Director of PNP-RECOM 8 In its decision of 24 March 1995, the NAPOLCOM, through
handed down a decision 6 finding the petitioners guilty of Commissioner Alexis Canonizado, denied due course to the
grave misconduct and ordering their dismissal from the petitioners' appeal and petition for review for lack of
police service. Pursuant to this decision, Special Order No. jurisdiction "it appearing . . . that both the Decision and the
174, dated 23 April 1994, 7 was issued ordering, among Resolution of the Regional Appellate Board had long
other things, the dismissal of the petitioners from the become final and executory and there being no showing
service. that the RAB failed to decide respondents' appeal within the
reglementary period of sixty (60) days." 15 In support thereof,
The petitioners claimed that they were not formally the NAPOLCOM cited Section 23, Rule IV of NAPOLCOM
furnished with a copy of the decision and that they were Memorandum Circular No. 91-002 and Section 5, Rule III of
able to secure a copy thereof "thru their own effort and NAPOLCOM Memorandum Circular No. 91-006, which
initiative" only on 13 June 1994. 8 However, they received a provide as follows:
copy of Special Order No. 174 on 26 April 1994.
Sec. 23. Effect of Failure to Decide Appeal.
Although they insist that the basis of the appeal before RAB — Failure of the Regional Appellate Board to
8 was Special Order No. 174, 9 petitioner Cabada stated decide the appeal within the reglementary
under oath in his period shall render the decision final and
Appeal10 filed with the Department of Interior and Local executory without prejudice, however, to the
Government (DILG) that he in fact seasonably filed a filing of an appeal by either party with the
motion for reconsideration of the decision of the Regional Secretary of the Department of the Interior
Director of PNP-RECOM 8, who, however, failed or refused and Local Government.
to act on the said motion, and that he asked that the said
motion be treated as an appeal to the RAB. xxx xxx xxx
In its decision of 15 August 1994, 11 the RAB 8 affirmed the Sec. 5. Finality of Decision/Resolution. — The
decision of the Regional Director. In its resolution of 25 decision of the Regional Appellate Board on
October 1994, 12 it denied the petitioners' motion for an appealed case shall become final and
executory after ten (10) days from receipt of a (2) The Secretaries . . . shall have jurisdiction
copy thereof by the appellant, if no Motion for to investigate and decide matters involving
Reconsideration is filed within said period. disciplinary action against officers and
employees under their jurisdiction. . . . In case
A motion for Reconsideration may be filed by the decision rendered by a bureau or office
either party from a Decision rendered by the head is appealable to the Commission, the
Regional Appellate Board on an appealed same may be initially appealed to the
case, provided that the same is filed within Department and finally to the Commission
ten (10) days from receipt of a copy of the and pending appeal, the same shall be
decision in question. However, only one (1) executory except when the penalty is
Motion for Reconsideration may be allowed. removal, in which case, the same shall be
executory only after confirmation by the
Hence, the instant petition. Secretary concerned.
The Office of the Solicitor General seeks to dismiss this The Office of the Solicitor General opines that this provision
petition on the ground of prematurity because the covers PNP personnel, like the petitioners; consequently,
petitioners failed to exhaust administrative remedies; they they should have appealed to the CSC. It also advances the
should have instead appealed to the Civil Service view that the instant petition should have been filed with the
Commission (CSC) pursuant to Section 47, Chapter 6, proper forum, the Regional Trial Court.
Subtitle A, Title I, Book V of the Administrative Code of
1987 (E.O. No. 292), which vests upon the CSC appellate The core issues that present themselves for our
jurisdiction over disciplinary cases of government personnel determination are whether.
where the penalty imposed is, inter alia, dismissal from
office. The said provision reads: (1) the NAPOLCOM committed grave abuse
of discretion in denying due course, for lack of
Sec. 47. Disciplinary Jurisdiction. — (1) The jurisdiction, the petitioners' appeal from and
Commission shall decide upon appeal all petition for review of the decision and
administrative disciplinary cases involving the resolution of the RAB 8; and
imposition of a penalty of suspension for
more than thirty days, or fine in an amount (2) this special civil action was prematurely
exceeding thirty days salary, demotion in rank filed for failure of the petitioners to exhaust
or salary or transfer, or removal or dismissal administrative remedies.
from office. . . .
Section 45 of the DILG Act of 1990 16 provides for the finality Sec. 3. Period Within Which to Decide
of disciplinary actions against members of the PNP as Appealed Cases; Finality of RAB/NAB
follows: Decisions. — The NAPOLCOM appellate
board concerned shall decide the appealed
Sec. 45. Finality of Disciplinary Action. — The cases within sixty (60) days from receipt of
disciplinary action imposed upon a member of the entire records of the case from the PNP
the PNP shall be final and summary dismissal authority. However,
executory: Provided, That a disciplinary failure of the NAPOLCOM Regional Appellate
action imposed by the regional director or by Board (RAB) to act on the appeal within said
the PLEB involving demotion or dismissal period renders the decision final and
from the service may be appealed to the executory without prejudice to the filing of an
regional appellate board within ten (10) days appeal by the respondent-appellant with the
from receipt of the copy of the notice of Secretary of the Department of the Interior
decision: Provided, further, That the and Local Government. The decision
disciplinary action imposed by the Chief of the rendered by the NAPOLCOM National
PNP involving demotion or dismissal may be Appellate Board (NAB) disposing an
appealed to the National Appellate Board appealed case shall be final and executory
within ten (10) days from receipt unless a timely Motion for Reconsideration is
thereof: Provided, furthermore, That, the filed within ten (10) days from receipt thereof,
regional or National Appellate Board, as the in which case, it shall become final and
case may be, shall decide the appeal within executory upon receipt by the respondent-
sixty (60) days from receipt of the notice of appellant of the resolution of the aforesaid
appeal: Provided, finally, That failure of the board denying, modifying or affirming the
regional appellate board to act on the appeal decision.
within said period shall render the decision
final and executory without prejudice, Section 45 of the DILG Act of 1990 specifically provides that
however, to the filing of an appeal by either if a RAB fails to decide an appeal within the reglementary
party with the Secretary. (emphasis supplied) period of sixty days, the appealed decision becomes final
and executory without, however, prejudice to the right of the
The last proviso of this section is restated in Section 23, aggrieved party to appeal to the Secretary of the DILG. The
Rule IV of NAPOLCOM Memorandum Circular No. 91-002. said provision is, however, silent as regards the availability
And Section 3, Rule III of NAPOLCOM Memorandum of an appeal from a decision rendered by a RAB within the
Circular No. 92-006 provides: reglementary period.
This gap in Section 45 cannot be construed to prohibit Sec. 31. Except as otherwise provided by the
appeals from decisions of the RAB rendered within the Constitution or by law, the Commission shall
reglementary period, for while the epigraph of the section is have the final authority to pass upon the
worded Finality of Disciplinary Action, there is nothing removal, separation and suspension of all
therein that explicitly bars any further appeal. officers and employees in the civil service and
Complementary laws on discipline of government officials upon all matters relating to the conduct,
and employees must then be inquired into considering that discipline and efficiency of such officers and
in conformity with the mandate of the Constitution that the employees.
PNP must be national in scope and civilian in character, 17 it
is now a part, as a bureau, of the reorganized DILG. 18 As Sec. 32. The Secretaries and heads of
such, it falls within the definition of the civil service in agencies and instrumentalities, provinces,
Section 2 (1), Article IX-B of the Constitution. 19 For this cities and municipalities shall have jurisdiction
reason, Section 91 of the DILG Act of 1990 provides: to investigate and decide matters involving
disciplinary action against officers and
Sec. 91. Application of Civil Service Laws. — employees under their jurisdiction. Their
The Civil Service Law and its implementing decisions shall be final in case the penalty
rules and regulations shall apply to all imposed is suspension for not more than
personnel of the Department. thirty (30) days or fine in an amount not
exceeding thirty (30) days' salary. In case the
The Civil Service Law referred to in Section 91 of the DILG decision rendered by a bureau or office head
Act of 1990 is Subtitle A, Title I, Book V of the is appealable to the Commission, the same
Administrative Code of 1987 (E.O. No. 292). Section 47 of may be initially appealed to the department,
Chapter 6 thereof provides, inter alia, that in cases where then to the Merit Systems Protection Board,
the decision rendered by a bureau or office is appealable to and finally to the Commission and pending
the Commission, the same may initially be appealed to the appeal, the same shall be executory except
department and finally to the Commission. when the penalty is removal, in which case
the same shall be executory only after
The rules and regulations implementing the Civil Service confirmation by the Secretary concerned.
Law referred to in Section 91 of the DILG Act of 1990 is the
Omnibus Rules Implementing Book V of Executive Order Under Section 7 of E.O. No. 262, 20 the Secretary of the
No. 292 known as the Administrative Code of 1987 DILG has the power of supervision and control of his
promulgated by the CSC. Sections 31 and 32, Rule XIV of Department. His powers and functions thereunder are
the said Rules provide as follows: recognized and affirmed in Section 10 of the DILG Act of
1990. 21
In view then of the aforementioned gap in Section 45 of the within the jurisdiction of the NAPOLCOM. The latter does
DILG Act of 1990, the provisions of the Civil Service Law not have such jurisdiction because Section 14 of the DILG
and the rules and regulations implementing it must be taken Act of 1990 pertinently provides as follows:
into account in light of the maxim interpretare concordare
legibus est optimus interpretandi or every statute must be Sec. 14. Powers and Functions of the
so construed and harmonized with other statutes as to form Commission. — . . .
a uniform system of jurisprudence. 22
xxx xxx xxx
As thus construed and harmonized, it follows that if a RAB
fails to decide an appealed case within sixty days from (i) Affirm, reverse or modify, through the
receipt of the notice of appeal, the appealed decision is National Appellate Board, personnel
deemed final and executory, and the aggrieved party may disciplinary action involving demotion or
forthwith appeal therefrom to the Secretary of the DILG. dismissal from the service imposed upon
Likewise, if the RAB has decided the appeal within the members of the Philippine National Police by
sixty-day period, its decision may still be appealed to the the Chief of the Philippine National Police;
Secretary of the DILG.
(k) Exercise appellate jurisdiction through the
In the instant case, Cabada's appeal was addressed to "the regional appellate boards over administrative
Honorable Secretary of the Department of the Interior and cases against policemen and over decisions
Local Government . . . as Chairman and Presiding Officer of on claims for police benefits. . . .
the National Police Commission," 23 while De Guzman's
petition for review was addressed to "the Honorable This section clearly shows that the NAPOLCOM
Secretary, Department of the Interior and Local exercise appellate jurisdiction only on the following
Government and Chairman, National Police Commission, cases and THROUGH (a) the NAB in personnel
Makati City, Metro Manila." 24 disciplinary actions involving demotion or dismissal
from the service imposed by the Chief of the PNP,
We consider the appeal and the petition for review as and (b) the RAB in administrative cases against
appeals to the Secretary of the DILG under Section 45 of policemen and over decisions on claims for police
the DILG Act of 1990. benefits. It has no appellate jurisdiction over
decisions rendered by the NAB and the RAB.
Only the Secretary of the DILG can act thereon, one way or
the other. The NAPOLCOM did not have authority over the Consequently, the NAPOLCOM did not have the power or
appeal and the petition for review, and just because both authority to issue, through Commissioner Alexis
mentioned the Secretary of the DILG as Chairman or Canonizado, the 24 March 1995 decision denying due
Presiding Officer of the NAPOLCOM did not bring them course to the appeal and petition for review filed by
petitioners Cabada and De Guzman, respectively, for lack 1990; Section 47, Chapter 6, Subtitle A, Title I, Book V of
of jurisdiction because of Section 5, Rule III of NAPOLCOM the Administrative Code of 1987; and Sections 31 and 32 of
Memorandum Circular No. 91-006 and Section 23, Rule IV the Omnibus Rules Implementing Book V of Executive
of NAPOLCOM Memorandum Circular No. 91-002. The Order No. 292, the appeal would have to be filed with the
reference to these rules suggest that the NAPOLCOM CSC. And futile would be the petitioners claim in their Reply
believes it has jurisdiction over appeals from decisions of to the Comment of the OSG that their case falls within the
the RAB if the latter has not decided the appeal within the exceptions to the rule on exhaustion of administrative
reglementary period of sixty days. Such a suggestion is remedies.
flawed because it would allow a ridiculous situation where
the NAPOLCOM vests upon itself an appellate jurisdiction In view of all the foregoing, a discussion on the other issues
from a decision rendered by it in the exercise of its raised by the petitioners relating to the merits of the case
appellate jurisdiction through the RAB, per Section 14(k) of and on the issue of due process is unnecessary.
the DILG Act of 1990. Moreover, Commissioner
Canonizado cannot, singly, act for the NAPOLCOM WHEREFORE, premises considered, the instant petition is
because it is a collegial body composed of a Chairman and GRANTED. The decision (in the form of a fetter) of the
four Commissioners, pursuant to Section 13 of the DILG Act National Police Commission of 24 March 1995 is
of 1990. ANNULLED and SET ASIDE. The Secretary of the
Department of Interior and Local Government is DIRECTED
In light of the foregoing, the petitioners could properly to RESOLVE with reasonable dispatch the appeal and
invoke our original jurisdiction to issue the extraordinary writ petition for review of petitioners SP03 NOEL CABADA and
ofcertiorari under Rule 65 of the Rules of Court to annul and SP03 RODOLFO G. DE Guzman, respectively, from the
set aside the NAPOLCOM's decision of 24 March 1995. It decision of 15 August 1994 and resolution of 25 October
being a patent nullity, the filing of a motion for its 1994 of the Regional Appellate Boar, Eight Regional
reconsideration before the institution of this special civil Command, if the same were filed on time.
action may be dispensed with. 25
No pronouncement as to costs.
II
SO ORDERED.
The plea of the Office of the Solicitor General that the
instant action is premature for non-exhaustion of
administrative remedies is thus untenable. We would have
sustained it if the Secretary of the DILG was the one who
denied due course to or dismissed the appeal of petitioner
Cabada and the petition for review of petitioner De
Guzman. By then, pursuant to Section 91 of the DILG Act of
FACTS: In its decision of 15 August 1994, the RAB 8 affirmed the
decision of the Regional Director. In its resolution of
On 29 October 1993, a complaint against the petitioners 25October 1994, it denied the petitioners motion for
for Grave Misconduct, Arbitrary Detention, and reconsideration of its decision. The petitioners received a
Dishonesty was filed with the Office of the Commission copy of this resolution on 26 January 1995. Petitioners
on Human Rights in Tacloban City by private respondent Cabada and De Guzman then filed with the Honorable
Mario Valdez. On 7 April 1994, the Regional Director of Secretary of the DILG and Chairman of the NAPOLCOM
PNP-RECOM 8 (Philippine National Police Eighth their Appeal dated 5 February 1995 and Petition for
Regional Command) handed down a decision finding the Review dated 4 February 1995, respectively.
petitioners guilty of grave misconduct and ordering their
dismissal from thepolice service. Pursuant to this In its decision of 24 March 1995, the NAPOLCOM,
decision, Special Order No. 174, dated 23 April 1994, through Commissioner Alexis Canonizado, denied due
was issued ordering,among other things, the dismissal of course to the petitioners appeal and petition for review for
the petitioners from the service. lack of jurisdiction it appearing x x x that both the
Decision and the Resolution of the Regional Appellate
The petitioners claimed that they were not formally Board had long become final and executory and there
furnished with a copy of the decision and that they were being no showing that the RAB failed to decide
ableto secure a copy thereof thru their own effort and respondents appeal within the reglementary period of
initiative only on 13 June 1994. However, they received a sixty (60)days. In support thereof, the NAPOLCOM cited
copyof Special Order No. 174 on 26 April 1994. Although Section 23, Rule IV of NAPOLCOM Memorandum
they insist that the basis of the appeal before RAB 8 Circular No.91-002 and Section 5, Rule III of
(Regional Appellate Board of the Eighth NAPOLCOM Memorandum Circular No. 91-006, which
RegionalCommand) was Special Order No. provide as follows: Section 23. Effect of Failure to Decide
174,petitioner Cabada stated under oath in his Appeal Appeal. Failure of the Regional Appellate Board to decide
filed with the Department of Interior and Local the appeal within the reglementary period shall render
Government (DILG) that he in fact seasonably filed a the decision final and executory without prejudice,
motion for reconsideration of the decision of the Regional however, to the filing of an appeal by either party with the
Director of PNP-RECOM 8, who, however, failed or Secretary of the Department of the Interior and Local
refused to act on the said motion, and that he asked that Government.
the said motion be treated as an appeal to the RAB. Section 5. Finality of Decision/Resolution. The decision of
the Regional Appellate Board on an appealed caseshall
become final and executory after ten (10) days from
receipt of a copy thereof by the appellant, if no Motionfor
Reconsideration is filed within said HELD:
period. A motion for Reconsideration may be filed by eith 1. In light of the foregoing, the petitioners could properly
er party from a Decision rendered by the Regional Appell invoke our original jurisdiction to issue the extraordinary
ateBoard on an appealed case, provided that the same is writ of certiorari under Rule 65 of the Rules of Court to
filed within ten (10) days from receipt of a copy of the annual and set aside the NAPOLCOMs decision of
decision in question. However, only one (1) Motion for 24March 1995. It being a patent nullity, the filing of a
Reconsideration may be allowed. *The Office of the motion for its reconsideration before the institution of
Solicitor General seeks to dismiss this petition on the thisspecial civil action may be dispensed with. If a RAB
ground of prematurity because the petitioners failed to fails to decide an appealed case within sixty days from
exhaust administrative remedies; they should have receipt of the notice of appeal, the appealed decision is
instead appealed to the Civil Service Commission (CSC) deemed final and executory, and the aggrieved party
pursuant to Section 47, Chapter 6, Subtitle A, Title I, may forthwith appeal therefrom to the Secretaryof the
Book V of the Administrative Code of1987 (E.O. No. DILG. Likewise, if the RAB has decided the appeal within
292), which vests upon the CSC appellate jurisdiction the sixty-day period, its decision may still be appealed to
over disciplinary cases of government personnel where the Secretary of the DILG.In the instant case, Cabadas
the penalty imposed is, inter alia, dismissal from office. appeal was addressed to the Honorable Secretary of the
Department of the Interior and Local Government x x x as
Chairman and Presiding Officer of the National Police
ISSUE/S: Commission, while DeGuzmans petition for review was
(1) WON the NAPOLCOM committed grave abuse of addressed to the Honorable Secretary, Department of the
discretion in denying due course, for lack of jurisdiction, Interior and Local Government and Chairman, National
thepetitioners appeal from and petition for review of the Police Commission, Makati City, Metro Manila. We
decision and resolution of the RAB 8; and consider the appeal and the petition for review as
(2) WON this special civil action was prematurely filed for appeals to the Secretary of the DILG under Section 45 of
failure of the petitioners to exhaust administrative the DILG Act of 1990.
remedies.
Only the Secretary of the DILG can act thereon, one way
or the other. The NAPOLCOM did not have authorityover
the appeal and the petition for review, and just because
both mentioned the Secretary of the DILG asChairman or
Presiding Officer of the NAPOLCOM did not bring them
within the jurisdiction of the NAPOLCOM.The latter does
not have such jurisdiction because Section 14 of the
DILG Act of 1990 pertinently provides Book Vof Executive Order No. 292, the appeal would
asfollows:Functions of the Commission. x x x xxx xxx have to be filed with the CSC. And futile would be the
xxx (j) Affirm, reverse or modify, through the National petitionersclaim in their Reply to the Comment of the
Appellate Board, personnel disciplinary action OSG that their case falls within the exceptions to the rule
involvingdemotion or dismissal from the service imposed onexhaustion of administrative remedies.
upon members of the Philippine National Police by the
Chief ofthe Philippine National Police; (k) Exercise
appellate jurisdiction through the regional appellate
boards over administrative cases againstpolicemen and SECOND DIVISION
over decisions on claims for police benefits. x x x This
section clearly shows that the NAPOLCOM exercises G.R. No. L-42380 June 22, 1990
appellate jurisdiction only on the following cases and
THROUGH (a) the NAB in personnel disciplinary actions DATILES AND COMPANY, represented by LORETA DATILES
and LARRY DATILES, petitioner,
involving demotion or dismissal from the service imposed vs.
by the Chief of the PNP, and (b) the RAB in Honorable MELQUIADES S. SUCALDITO, Presiding Judge of
administrative cases against policemen and over Branch I, Court of First Instance of Zamboanga del Sur,
decisions on claims for police benefits. It has no Honorable MATIAS A. GUIEB, or his Successor-in-Office,
appellate jurisdiction over decisions rendered by the NAB Regional Director, Region No. IX, Bureau of Fisheries and
and the RAB. Aquatic Resources and JESUS DEYPALUBOS and DANIEL
CABELIEZA, respondents.
Cerilles & Cerilles, Vera Cruz, Largo, Bautista Law Offices for
2. The plea of the Office of the Solicitor General that the respondent J. Deypalubos.
instant action is premature for non-exhaustion of
administrative remedies is thus untenable. We would
have sustained it if the Secretary of the DILG was the
PADILLA, J.:
one who denied due course to or dismissed the appeal of
petitioner Cabada and the petition for review of petitioner The issue before the Court is whether or not an investigation of a formal protest over a lease
De Guzman. By then, pursuant to Section 91 of the DILG grant, by a Regional Director of the Bureau of Fisheries and Aquatic Resources may be the
subject of a petition for prohibition and/or injunction before the Regional Trial Court, in the
Act of 1990; Section 47, Chapter 6, Subtitle A, Title light of the following antecedent facts:
I,Book V of the Administrative Code of 1987; and
Sections 31 and 32 of the Omnibus Rules Implementing
Petitioner Datiles and Company has in its favor a fishpond lease Later, or on 18 February 1974, the trial court, in Civil Case No.
agreement 1 whereby the Republic of the Philippines, thru the 1389 ordered the issuance of a writ of preliminary mandatory
Secretary of Agriculture and Natural Resources, agreed to lease injunction against both respondents 7 resulting in the restoration
to the company one hundred seventy five hectares, ninety nine of possession and occupancy of the disputed areas by the
ares and fifty-nine centares (175.9959 has.) of public land located petitioner on 28 May 1974. 8
in Batu, Siay, Zamboanga del Sur, for fishpond purposes.
Fishpond Lease Agreement (FLA) No. 1902 was executed on 16 Thereafter, or on 2 June 1974, the Barrio Council of Batu, Slay,
June 1971, with an original period of ten (10) years, later Zamboanga del Sur prepared and submitted to the Bureau of
extended to twenty five (25) years, or up to year 2002. 2 Fisheries a resolution 9 which attests that the 49 hectare
controverted fishpond area was never occupied by the Datiles
About the middle of 1973, petitioner-lessee filed a complaint for family (herein petitioner company's predecessor) and that it was
"Injunction with Writ of Possession with Preliminary and Mr. Deypalubos (herein private co-respondent) who cleared the
Prohibitory Injunction, with Damages" before the Court of First same and constructed all the improvements therein. The
Instance (now Regional Trial Court) of Zamboanga del Sur, and resolution further requests that the original grant of 175.9959
docketed as Civil Case No. 1389, against herein private hectares to Datiles and Company (herein petitioner) be reduced
respondents Jesus Deypalubos and Daniel Cabdieza. 3 Said court to fifty (50) hectares only in accordance with a certain presidential
action was alleged to have been resorted to after the vehement decree limiting the cultivation of a fishpond to about fifty (50)
refusal of the respondents to obey the orders of the then hectares, with the remaining area to be distributed to poor
Philippine Fisheries Commission and Bureau of Fisheries 4 (now families.
Bureau of Fisheries and Aquatic Resources) to vacate that
portion of the area covered by FLA No. 1902 which they (private No investigation of both the above-mentioned barrio council
respondents) were occupying without a fishpond permit and the resolution and Deypalubos' formal protest over the forty-nine (49)
knowledge and consent of petitioner. hectares was held in view of a 29 October 1974 order of the
Bureau Director to hold in abeyance any hearing on the matter
To the accusation of their unlawful entry, private respondents set until such time that Civil Case No. 1389 shall have been finally
up the defense of good faith at the time of their entry and resolved. 10
occupation of the land which they described as forested and
uncultivated. They added that prior to the filing of their own On 3 January 1975, another memorandum was issued by the
respective fishpond lease applications over the disputed area Bureau Director addressed to herein public respondent Regional
(i.e., Deypalubos on the southern portion of about forty-nine (49) Director Guieb, directing "an immediate formal investigation of
hectares and Cabelieza on the eastern part of about two (2) those issues involved in the foregoing resolution and the protest
hectares) on 3 January 1973, they were assured by an officer of Mr. Jesus Deypalubos ...and not touched upon in Civil Case
from the Bureau that the areas were unoccupied and not subject No. 1389." 11
of any pending leasehold agreement or application.5
Accordingly, public respondent Guieb notified the parties of the
Meanwhile, respondent Deypalubos submitted to the Bureau of scheduled hearing of the said protest and resolution. 12
Fisheries his formal protest against petitioner's existing fishpond
permit over the 49 hectares, subject on Civil Case 1389. 6
Praying to restrain the proposed investigation on the fishpond development of the natural resources of the
conflict, petitioner filed its 10 February 1975 petition for Philippines.
"Prohibition and/or Injunction with Preliminary Injunction" (Special
Civil Case No. 1426) before the CFI of Zamboanga del Sur Upholding respondents' contentions, the respondent judge
against public respondent Guieb and impleading pro dismissed Sp. Civil Case No. 1426 and lifted the 31 March 1975
forma therein respondents Deypalubos and restraining order on 4 August 1975. Pertinent portions of his
Cabelieza. 13Following the limitation on the scope of issues to be decision read as follows: 16
investigated as directed in the 3 January 1975 Memorandum of
the Bureau Director, petitioner alleged that Regional Director ... the element of said section which read:
Guieb has no longer any authority to conduct the investigation, as
the issues proposed to be investigated are the same issues
or any action whatsoever by the
raised in the then pending Civil Case No. 1389.
proper administrative officials or
body on concessions, licenses,
The presiding judge of the court a quo, Hon. Melquiades S. permits, patents or public grants of
Sucaldito (now respondent), seeing that a possible irreparable any kind.
injury could be caused the petitioner if the investigation in
question were to proceed, issued the 31 March 1975 restraining
is so embrasive as to include the projected
order. 14
investigation sought to be prohibited. Clearly,
therefore, Section 1 of Presidential Decree No.
During the trial of said Sp. Civil Case No. 1426, private 605, as cited above, is squarely applicable to the
respondents moved to dismiss the case and to dissolve the restraining order sought to be dissolved. ...
restraining order, 15 anchored on the grounds of (a) lack of the
court's jurisdiction to try the case for failure on the part of
... in that Civil Case No. 1389, in granting the said
petitioner to exhaust available administrative remedies, and (b)
Writ of Preliminary Mandatory and Prohibitory
violation of Section 1 of Pres. Decree No. 605 which provides, in
Injunction, the Court acted solely to eject the
part, as follows:
respondents Deypalubos and Cabelleza from, and
to prevent their return to the premises in question;
SECTION 1. No court of the Philippines shall to prevent them in widening their possession ....
have jurisdiction to issue any restraining order, This Civil Case No. 1389 has not yet been tried
preliminary injunction or preliminary mandatory on the merit. On the other hand, the investigation
injunction in any case involving or growing out of sought to be enjoined, and/or prohibited, involved
the issuance, approval or disapproval, revocation not only mere possession, but the right of the
or suspension of, or any action whatsoever by the parties to lease the premises in question, based
proper administrative official or body on on law, rules and regulations issued by the
concessions, licenses, permits, patents, or public Bureau of Fisheries and Aquatic Resources. This
grants of connection with the disposition, investigation, therefore, pertains to, and within the
exploitation, utilization, exploration and/or exclusive jurisdiction of the Bureau of Fisheries. In
this investigation of the protest, it might be shown We rule for the petitioner.
that while defendants may have no right in the
beginning, they might have acquired later on, It is a well-settled rule that, for prohibition to lie against an
equitable right which may lead to the approval of executive officer, the petitioner must first exhaust administrative
their fishpond applications on the land in question. remedies. This doctrine rests upon the assumption that the
It may likewise show, upon the other hand, that administrative body, board or officer, if given the chance to
petitioner has not complied with the conditions of correct its/his mistake or error, may amend its/his decision on a
its lease agreement; given matter. 20 It follows therefore that there has to be some sort
of a decision, order or act, more or less final in character, that is
xxx ripe for review and properly the subject of an appeal to a higher
administrative body or officer, for the principle of exhaustion of
Besides, the petitioner in this case has an administrative remedies to operate. In the present case, however,
available, adequate and speedy remedy that is to there is no administrative order or act as above described, that
appeal this matter of investigation to the proper can be appealed from. The respondent Regional Director has not
superior official-which in this case is the Secretary rendered any decision, or made any final finding of any sort, and
of agriculture and Natural Resources. The plaintiff is in fact just about to conduct an investigation which happens to
having failed to do this, the Court has no be the very act sought to be prevented. Consequently,
jurisdiction to entertain the present petition for administrative remedies that must be exhausted, although
prohibition. ... available, cannot be resorted to. There being urgency in stopping
public respondent Guieb's investigation but no plain, speedy and
Hence, this petition for review, which was previously denied for adequate remedy in the ordinary course of law, petitioner's
lack of merit by this Court in a 28 May 1976 recourse to the respondent court for relief by way of a petition for
Resolution. 17Petitioner moved for the reconsideration of the said prohibition was proper.
order of denial 18 and on 22 April 1977, the Court decided to give
due course to the instant petition. 19 We now look into PD No. 605. Its evident purpose is to prevent
the substitution of judicial judgments for those of public
Petitioner's recourse to this Court is actually based on Section 2, administrative officials in disputes involving the disposition or
Rule 65 of the Rules of Court, seeking to prevent public utilization of natural resources of the country. The decree seeks
respondent Guieb from investigating the subject fishpond conflict, to leave to administrative agencies the authority to decide
on the ground that this threatened act constitutes excess in the controversies involving licenses, permits, patents or public grants
exercise of his jurisdiction. On the other hand, while respondents in connection with natural resources, obviously because of the
do not contest that the nature of the contemplated action expertise of such administrative officials in dealing with such
(investigation) can be a proper subject of a petition for prohibition, problems.
it is nonetheless submitted that there being no prior exhaustion of
administrative remedies on petitioner's part and in view of PD. The issuance of said decree (No. 605) does not, however, mean
No. 606, the respondent court cannot Properly take jurisdiction of that courts cannot exercise jurisdiction where questions of law are
the petition for prohibition. involved, as in the case at bar. Here, what was assailed before
respondent judge is Regional Director Guieb's move to conduct
an investigation on Deypalubos' formal protest, the petitioner's was assured of the absence of any improvements in the area he
theory being that to investigate the matter is to go beyond what occupied, and that it was he who introduced all the substantial
the Director of the Bureau of Fisheries had authorized in his 3 improvements therein until petitioner company began harassing
January 1975 Memorandum, which is "to cause an immediate him. These issues were however raised and, in fact, already
formal investigation of those issues involved in the foregoing passed upon in the decision rendered in Civil Case No. 1389,
resolution and the protest ... and not touched upon in Civil Case which became final and executory on 26 October
No. 1389. 21 (Emphasis supplied) 1980. 22 Elaborating on these points, the court in said Civil Case
No. 1389, in a 21-page decision, found the above allegations not
The situation, therefore, called for a determination of whether or credible and ordered, among others, the forfeiture in favor of
not the proposed investigation was indeed an over-exercise of petitioner of the improvements built and constructed by
authority by respondent Regional Director as claimed by the Deypalubos in the controverted area covered by FLA No. 1902.
petitioner; and if this was resolved in the negative, the Said court findings are consistent with the results of the
investigation would have been allowed to proceed. The inspection by the former Philippine Fisheries Commission and
respondent court was called upon to look only into the propriety of Bureau of Fisheries conducted in 1973. 23
the investigation regardless of the fact that the investigation could
result in the issuance and/or revocation of fishpond lease permits The insistence still of respondent Regional Director Guieb to
of the contending parties. proceed with the investigation, knowing fully well that there
remain no other issues in Deypalubos' protest that were not
As to the prohibition dictated by PD No. 605, the same pertains to previously raised in Civil Case No. 1389 and before the same
the issuance by courts of injunctions or restraining orders against Bureau, leads one to conclude that he is acting in excess of his
administrative acts on controversies which involve facts or delegated authority to investigate. After these issues had been
exercise of discretion in technical cases, because to allow courts tried and investigated, administratively and judicially, the same
to judge these matters could disturb the smooth functioning of the issues can no longer be reopened by public respondent Guieb.
administrative machinery. But on issues definitely outside of this
dimension and involving questions of law, courts are not The Barrio Council Resolution intended to be included in the
prevented by PD No. 605 from exercising their power to restrain investigation by public respondent Guieb likewise contains the
or prohibit administrative acts. very same averments made in the protest, the only new matter
presented being that petitioner should have been awarded fifty
Instead of remanding this case to respondent court for further (50) hectares only in view of a presidential decree limiting
proceedings, we win put a finish to it. At bottom line, the real legal administrative grants of fishpond permits or leases to just this
issue here is whether public respondent Guieb should desist from much. The provisions of the invoked decree have not however
investigating petitioner's fishpond lease No. 1902. It will be been set forth nor the decree number indicated. All that was said
recalled that when respondent Guieb issued the notice of hearing is that there is an existing decree to that effect, and nothing more.
of 24 February 1975 to the parties, the subjects of investigation, Such a broad statement does not justify a reinvestigation of this
as indicated therein, were the 18 September 1973 Protest against fishpond conflict.
FLA No. 1902 and the 2 June 1974 Barrio Council Resolution.
The said Protest consists of Deypalubos' assertions that prior to Justice and fairness dictate that long-resolved matters be finally
his application for a fishpond permit for the area in question, he closed and laid to rest.
WHEREFORE, the 4 August 1975 decision in Sp. Civil Case No. The case at bar involves the legality of negotiated security
1426 is REVERSED and public respondent Guieb is hereby contracts awarded by the National Food Authority (NFA), a
ordered to REFRAIN and DESIST from investigating the government-owned and controlled corporation and its
respondent Deypalubos' protest of 18 September 1973 and the Administrator, Romeo G. David, to several private security
Barrio Council Resolution of 2 June 1974 of Batu-Siay, agencies, in default of a public bidding. Petitioners NFA and
Zamboanga del Sur questioning Fishpond Lease Agreement No. David seek a modification of the decision of the Court of Appeals
1902 in favor of petitioner. insofar as it nullifies and enjoins the implementation of the said
negotiated security contracts.
SO ORDERED.
The facts are not disputed.
When the bidding did not take place on June 30, 1993, the Assuming arguendo that an emergency actually existed and the
incumbent security agencies continued rendering services to negotiated contracts were justified, petitioners' continued failure
petitioners, albeit on a temporary and provisional basis. However, to conduct a public bidding and select the bidder within a
one month later, they were all terminated on grounds of expiration reasonable time casts doubts on the good faith behind the
of contract and loss of trust and confidence. negotiated contracts. This Court, on May 18, 1994, specifically
ordered petitioners to conduct a public bidding and report the
We agree with the Court of Appeals that it was well within the results within thirty days from holding thereof. In compliance, a
power of petitioners to discontinue the services of the incumbent public bidding was conducted on June 21, 1994 but until now no
security agencies. Their contracts with the NFA expired in 1992, bidder has been chosen and no contract has been awarded.
hence, their services were deemed terminated on said date. 13 The
fact that these agencies continued rendering services to NFA did Petitioners cited various reasons for the delay. They alleged that
not amount to an implied. renewal of their respective contracts. the minimum number of bidders in three of the five areas had not
Respondents do not have any vested right to continue their been met and that two bidders in the other two areas were in
contracts with NFA. They remained and continued performing collusion. This suspicion of collusion generated so much
their tasks at the tolerance of NFA who, by sending the notices of controversy that the PBAC could not decide whether to include
termination, simply reminded them of the expiration of their the bids of the two agencies. Finally, the PBAC excluded them
contracts. 14 These contracts can be renewed, revived or extended and recommended that the Administrator declare a failure of
only by mutual consent of the parties. No court can compel a bidding in all five areas of responsibility.
party to agree to a contract thru the instrumentality of a writ of
preliminary injunction. The Administrator should have immediately acted upon the
PBAC's recommendation and accordingly scheduled another
Nevertheless, what causes eyebrows to arch is the act of public bidding but somehow petitioners chose to abide by a
petitioners in discontinuing the incumbents' services. restraining order of the Davao trial court. It must be noted that
Respondents Manubay and Lasala allege that their agencies had what the Davao trial court issued was a temporary restraining
been rendering security services to the NFA since 198515 and order enjoining petitioners from awarding the contracts to the
1988, 16 respectively. Moreover, Manubay and Continental passed lowest or next lowest bidder at the June 21, 1994 public bidding.
the prequalification stage and were declared by the PBAC eligible It was not a writ of preliminary injunction nor was an order
to join the public bidding. Scarcely a month later, however, their restraining the holding of another bidding.
services were terminated at the same time and for the same
reasons as the rest of the incumbent security agencies. It is Petitioners and the PBAC are obviously taking their sweet time to
certainly strange why petitioners chose to do away with the select and award security contracts to winning bidders. They took
incumbents' services at a time when a "security void" would one year evaluating and deliberating on thirteen bid proposals
directly and most necessarily result from their withdrawal. The only to declare a failure of bidding in all five areas of
least petitioners could have done under the circumstances was to responsibility. Then they relied on a restraining order of a trial
court after no less that this Highest Court specifically ordered SO ORDERED.
them to conduct and conclude a public bidding.
On October 19, 1964 the petitioner wrote to the Division The controversy on the petitioner's date of birth arose as a result
Superintendents of Schools, reiterating his claim that he had not of the conflicting records of the Division of Schools of Negros
reached the age of 65 and enclosing some papers in support Oriental. On the one hand the pre-war records show his date of
thereof. birth to be November 26, 1897. These records consist of two
Insular Teachers Cards2 and one Employee's Record Card.3 It is
On April 13, 1965 he filed this suit for quo on the basis of these records that the Superintendent of Schools
warranto, mandamus and damages in the Court of First Instance determined the petitioner's age to be 66 years, 8 months and 22
of Negros Oriental. He asked the court to adjudge him entitled to days on August 15, 1964.
the office of principal of the Sta. Catalina Elementary School and
to order payment to him of not only his back salaries but also On the other hand, the post-war records, consisting of an
damages in the total amount of P52,400. Named as respondents Elementary Teacher's Report Card,4 an Employee's Record
were Eutiquio Mamigo, the District Supervisor, the Card,5 and an Employee's Record of Qualifications,6 state that the
Superintendent of Schools, the Director of Public Schools and the petitioner was born on Dec. 11, 1901. These are the records on
Secretary of Education. which the petitioner bases his claim.
The respondents filed their answer, entered into a stipulation of The problem is aggravated by two uncontroverted facts, namely,
facts with the petitioner, and thereafter the case was submitted that the records of the church where the petitioner was baptized
for decision. The trial court concluded that the petitioner was born were destroyed by fire, and that the municipal civil register
on December 11, 1901 accordingly granted his petition. contains no record. of the petitioner's birth.
Immediate execution was ordered, as a result of which the
petitioner was reinstated. According to the trial court, the post-war records were intended to
replace the pre-war records and therefore the correct date of birth
The respondents appealed directly to this Court. of the petitioner is December 11, 1901. The court also took into
account the verified answer in a cadastral proceeding in the Court
On July 6, 1967 the petitioner asked for the dismissal of the of First Instance of Negros Oriental, dated March 15, 1924, filed
appeal on the ground that the issues posed thereby had become by the petitioner's brother, Romulo Gravador, now deceased. It is
moot with his retirement from the service on December 11, 1966 therein stated that the petitioner, said to be one of the co-owners
and the payment to him of the corresponding retirement benefits. of a piece of land, was at the time 23 years old.
We deem it necessary, however, to review the trial court's
The respondents now contend that the trial court erred in placing In the second place, the import of the declaration of the
full reliance on the post-war records to establish the date of birth petitioner's brother, contained in a verified pleading in a cadastral
(December 11, 1901) of the petitioner. They argue that these case way back in 1924, to the effect that the petitioner was then
records were made only because it was thought that the pre-war 23 years old, can not be ignored. Made ante litem motamby a
records had been lost or destroyed, but as some pre-war records deceased relative, this statement is at once a declaration
had since been located, the date contained in the pre-war records regarding pedigree within the intendment and meaning of section
should be regarded as controlling and that the finding of the 33 of Rule 130 of the Rules of Court.
Superintendent of Schools that the petitioner was born on
November 26, 1897 is an administrative finding that should not be Thus, December 11, 1901 is established as the date of birth of
disturbed by the court. the petitioner not only by evidence of family tradition but also by
the declaration ante litem motam of a deceased relative. 1äwphï1.ñët
a) Cases involving the rights and obligations of (5) issuance, recall or cancellation of certificates
persons in the cultivation and use of agricultural of land transfer in cases outside the purview of
land except those cognizable by the National Presidential Decree No. 816;
Labor Relations Commission; Provided, That no
case involving the determination of rentals over
(6) right of retention of the landowner;
any kind of tenanted agricultural land shall be
taken cognizance of by the Courts of Agrarian
Relations unless there has been a prior fixing of xxx xxx xxx
provisional rental by the Department of Agrarian
Reform, except that the tenant-farmer may Provided, further, That the decision of the Secretary of Agrarian
directly bring the case for immediate Reform may be appealed to the President of the Philippines. 4
determination by the Courts of Agrarian Relations;
A perusal of the provision above cited reveals that questions as to
b) Questions involving rights granted and whether a landowner should or should not be allowed to retain his
obligations imposed by laws, Presidential landholdings are exclusively cognizable by the Minister (now
Decrees, Orders, Instructions, Rules and Secretary) of Agrarian Reform whose decision may be appealed
Regulations issued and promulgated in relation to to the Office of the President and not to the Court of Agrarian
the agrarian reform program; Provided, however, Relations. These cases are thus excluded from those cognizable
That matters involving the administrative by the then CAR, now the Regional Trial Courts. There is no
implementation of the transfer of the land to the appeal from a decision of the President. However, the said
tenant-farmer under Presidential Decree No. 27 decision may be reviewed by the courts through a special civil
and amendatory and related decrees, orders, action for certiorari, prohibition or mandamus, as the case may be
instructions, rules and regulations, shall be under Rule 65 of the Rules of Court.
Thus, the respondent appellate court erred in holding that it has FIRST DIVISION
no jurisdiction over the petition for review by way
ofcertiorari brought before it of a decision of the Minister of G.R. No. 151908 August 12, 2003
Agrarian Reform allegedly made in grave abuse of his discretion
and in holding that this is a matter within the competence of the SMART COMMUNICATIONS, INC. (SMART) and PILIPINO
Court of Agrarian Reform. The Court of Appeals has concurrent TELEPHONE CORPORATION (PILTEL), petitioners,
jurisdiction with this Court and the Regional Trial Court over vs.
petitions seeking the extraordinary remedy NATIONAL TELECOMMUNICATIONS COMMISSION
ofcertiorari, prohibition or mandamus. 5 (NTC), respondent.
The failure to appeal to the Office of the President from the x---------------------------------------------------------x
decision of the Minister of Agrarian Reform in this case is not a
violation of the rule on exhaustion of administrative remedies as
G.R. No. 152063 August 12, 2003
the latter is the alter ego of the President . 6
GLOBE TELECOM, INC. (GLOBE) and ISLA
WHEREFORE, the petition is GRANTED. The decision of the
COMMUNICATIONS CO., INC. (ISLACOM), petitioners,
Court of Appeals dated June 29, 1987 and its resolution dated
vs.
October 22, 1987, in CA-G.R. SP No. 08550 are set aside and
COURT OF APPEALS (The Former 6th Division) and the
the records of the case are remanded to said appellate court for
NATIONAL TELECOMMUNICATIONS
further proceedings. No costs.
COMMISSION,respondents.
SO ORDERED.
YNARES-SANTIAGO, J.:
(4) Subscribers shall be updated of the remaining value of d. share all necessary information of stolen cellphone
their cards before the start of every call using the cards. units to all other CMTS operators in order to prevent the
use of stolen cellphone units; and
(5) The unit of billing for the cellular mobile telephone
service whether postpaid or prepaid shall be reduced e. require all your existing prepaid SIM card customers to
from 1 minute per pulse to 6 seconds per pulse. The register and present valid identification cards.3
authorized rates per minute shall thus be divided by 10.1
This was followed by another Memorandum dated October 6,
The Memorandum Circular provided that it shall take effect 15 2000 addressed to all public telecommunications entities, which
days after its publication in a newspaper of general circulation reads:
and three certified true copies thereof furnished the UP Law
Center. It was published in the newspaper, The Philippine Star,
This is to remind you that the validity of all prepaid cards
on June 22, 2000.2 Meanwhile, the provisions of the
sold on 07 October 2000 and beyond shall be valid for at
Memorandum Circular pertaining to the sale and use of prepaid
least two (2) years from date of first use pursuant to MC
cards and the unit of billing for cellular mobile telephone service
13-6-2000.
took effect 90 days from the effectivity of the Memorandum
Circular.
In addition, all CMTS operators are reminded that all SIM
packs used by subscribers of prepaid cards sold on 07
On August 30, 2000, the NTC issued a Memorandum to all
October 2000 and beyond shall be valid for at least two
cellular mobile telephone service (CMTS) operators which
(2) years from date of first use. Also, the billing unit shall
contained measures to minimize if not totally eliminate the
be on a six (6) seconds pulse effective 07 October 2000.
For strict compliance.4 In the meantime, respondent NTC and its co-defendants filed a
motion to dismiss the case on the ground of petitioners' failure to
On October 20, 2000, petitioners Isla Communications Co., Inc. exhaust administrative remedies.
and Pilipino Telephone Corporation filed against the National
Telecommunications Commission, Commissioner Joseph A. Subsequently, after hearing petitioners' application for preliminary
Santiago, Deputy Commissioner Aurelio M. Umali and Deputy injunction as well as respondent's motion to dismiss, the trial
Commissioner Nestor C. Dacanay, an action for declaration of court issued on November 20, 2000 an Order, the dispositive
nullity of NTC Memorandum Circular No. 13-6-2000 (the Billing portion of which reads:
Circular) and the NTC Memorandum dated October 6, 2000, with
prayer for the issuance of a writ of preliminary injunction and WHEREFORE, premises considered, the defendants'
temporary restraining order. The complaint was docketed as Civil motion to dismiss is hereby denied for lack of merit. The
Case No. Q-00-42221 at the Regional Trial Court of Quezon City, plaintiffs' application for the issuance of a writ of
Branch 77.5 preliminary injunction is hereby granted. Accordingly, the
defendants are hereby enjoined from implementing NTC
Petitioners Islacom and Piltel alleged, inter alia, that the NTC has Memorandum Circular 13-6-2000 and the NTC
no jurisdiction to regulate the sale of consumer goods such as the Memorandum, dated October 6, 2000, pending the
prepaid call cards since such jurisdiction belongs to the issuance and finality of the decision in this case. The
Department of Trade and Industry under the Consumer Act of the plaintiffs and intervenors are, however, required to file a
Philippines; that the Billing Circular is oppressive, confiscatory bond in the sum of FIVE HUNDRED THOUSAND PESOS
and violative of the constitutional prohibition against deprivation of (P500,000.00), Philippine currency.
property without due process of law; that the Circular will result in
the impairment of the viability of the prepaid cellular service by SO ORDERED.8
unduly prolonging the validity and expiration of the prepaid SIM
and call cards; and that the requirements of identification of Defendants filed a motion for reconsideration, which was denied
prepaid card buyers and call balance announcement are in an Order dated February 1, 2001.9
unreasonable. Hence, they prayed that the Billing Circular be
declared null and void ab initio.
Respondent NTC thus filed a special civil action for certiorari and
prohibition with the Court of Appeals, which was docketed as CA-
Soon thereafter, petitioners Globe Telecom, Inc and Smart G.R. SP. No. 64274. On October 9, 2001, a decision was
Communications, Inc. filed a joint Motion for Leave to Intervene rendered, the decretal portion of which reads:
and to Admit Complaint-in-Intervention.6 This was granted by the
trial court.
WHEREFORE, premises considered, the instant petition
for certiorari and prohibition is GRANTED, in that, the
On October 27, 2000, the trial court issued a temporary order of the court a quo denying the petitioner's motion to
restraining order enjoining the NTC from implementing dismiss as well as the order of the court a quo granting
Memorandum Circular No. 13-6-2000 and the Memorandum the private respondents' prayer for a writ of preliminary
dated October 6, 2000.7 injunction, and the writ of preliminary injunction issued
thereby, are hereby ANNULLED and SET ASIDE. The D.
private respondents' complaint and complaint-in-
intervention below are hereby DISMISSED, without THE HONORABLE COURT OF APPEALS ERRED IN
prejudice to the referral of the private respondents' HOLDING THAT THE PRIVATE RESPONDENTS
grievances and disputes on the assailed issuances of the FAILED TO SHOW THEIR CLEAR POSITIVE RIGHT TO
NTC with the said agency. WARRANT THE ISSUANCE OF A WRIT OF
PRELIMINARY INJUNCTION.12
SO ORDERED.10
Likewise, Globe and Islacom filed a petition for review, docketed
Petitioners' motions for reconsideration were denied in a as G.R. No. 152063, assigning the following errors:
Resolution dated January 10, 2002 for lack of merit.11
1. THE HONORABLE COURT OF APPEALS SO
Hence, the instant petition for review filed by Smart and Piltel, GRAVELY ERRED BECAUSE THE DOCTRINES OF
which was docketed as G.R. No. 151908, anchored on the PRIMARY JURISDICTION AND EXHAUSTION OF
following grounds: ADMINISTRATIVE REMEDIES DO NOT APPLY SINCE
THE INSTANT CASE IS FOR LEGAL NULLIFICATION
A. (BECAUSE OF LEGAL INFIRMITIES AND VIOLATIONS
OF LAW) OF A PURELY ADMINISTRATIVE
THE HONORABLE COURT OF APPEALS GRAVELY REGULATION PROMULGATED BY AN AGENCY IN
ERRED IN HOLDING THAT THE NATIONAL THE EXERCISE OF ITS RULE MAKING POWERS AND
TELECOMMUNICATIONS COMMISSION (NTC) AND INVOLVES ONLY QUESTIONS OF LAW.
NOT THE REGULAR COURTS HAS JURISDICTION
OVER THE CASE. 2. THE HONORABLE COURT OF APPEALS SO
GRAVELY ERRED BECAUSE THE DOCTRINE ON
B. EXHAUSTION OF ADMINISTRATIVE REMEDIES DOES
NOT APPLY WHEN THE QUESTIONS RAISED ARE
PURELY LEGAL QUESTIONS.
THE HONORABLE COURT OF APPEALS ALSO
GRAVELY ERRED IN HOLDING THAT THE PRIVATE
RESPONDENTS FAILED TO EXHAUST AN AVAILABLE 3. THE HONORABLE COURT OF APPEALS SO
ADMINISTRATIVE REMEDY. GRAVELY ERRED BECAUSE THE DOCTRINE OF
EXHAUSTION OF ADMINISTRATIVE REMEDIES DOES
NOT APPLY WHERE THE ADMINISTRATIVE ACTION
C.
IS COMPLETE AND EFFECTIVE, WHEN THERE IS NO
OTHER REMEDY, AND THE PETITIONER STANDS TO
THE HONORABLE COURT OF APPEALS ERRED IN SUFFER GRAVE AND IRREPARABLE INJURY.
NOT HOLDING THAT THE BILLING CIRCULAR ISSUED
BY THE RESPONDENT NTC IS UNCONSTITUTIONAL
AND CONTRARY TO LAW AND PUBLIC POLICY.
4. THE HONORABLE COURT OF APPEALS SO administrative body, as well as with respect to what fields are
GRAVELY ERRED BECAUSE PETITIONERS IN FACT subject to regulation by it. It may not make rules and regulations
EXHAUSTED ALL ADMINISTRATIVE REMEDIES which are inconsistent with the provisions of the Constitution or a
AVAILABLE TO THEM. statute, particularly the statute it is administering or which created
it, or which are in derogation of, or defeat, the purpose of a
5. THE HONORABLE COURT OF APPEALS SO statute. In case of conflict between a statute and an
GRAVELY ERRED IN ISSUING ITS QUESTIONED administrative order, the former must prevail.18
RULINGS IN THIS CASE BECAUSE GLOBE AND ISLA
HAVE A CLEAR RIGHT TO AN INJUNCTION.13 Not to be confused with the quasi-legislative or rule-making
power of an administrative agency is its quasi-judicial or
The two petitions were consolidated in a Resolution dated administrative adjudicatory power. This is the power to hear and
February 17, 2003.14 determine questions of fact to which the legislative policy is to
apply and to decide in accordance with the standards laid down
On March 24, 2003, the petitions were given due course and the by the law itself in enforcing and administering the same law. The
parties were required to submit their respective memoranda.15 administrative body exercises its quasi-judicial power when it
performs in a judicial manner an act which is essentially of an
executive or administrative nature, where the power to act in such
We find merit in the petitions.
manner is incidental to or reasonably necessary for the
performance of the executive or administrative duty entrusted to
Administrative agencies possess quasi-legislative or rule-making it. In carrying out their quasi-judicial functions, the administrative
powers and quasi-judicial or administrative adjudicatory powers. officers or bodies are required to investigate facts or ascertain the
Quasi-legislative or rule-making power is the power to make rules existence of facts, hold hearings, weigh evidence, and draw
and regulations which results in delegated legislation that is within conclusions from them as basis for their official action and
the confines of the granting statute and the doctrine of non- exercise of discretion in a judicial nature.19
delegability and separability of powers.16
In questioning the validity or constitutionality of a rule or
The rules and regulations that administrative agencies regulation issued by an administrative agency, a party need not
promulgate, which are the product of a delegated legislative exhaust administrative remedies before going to court. This
power to create new and additional legal provisions that have the principle applies only where the act of the administrative agency
effect of law, should be within the scope of the statutory authority concerned was performed pursuant to its quasi-judicial function,
granted by the legislature to the administrative agency. It is and not when the assailed act pertained to its rule-making or
required that the regulation be germane to the objects and quasi-legislative power. In Association of Philippine Coconut
purposes of the law, and be not in contradiction to, but in Dessicators v. Philippine Coconut Authority,20it was held:
conformity with, the standards prescribed by law.17 They must
conform to and be consistent with the provisions of the enabling
The rule of requiring exhaustion of administrative remedies before
statute in order for such rule or regulation to be valid.
a party may seek judicial review, so strenuously urged by the
Constitutional and statutory provisions control with respect to
Solicitor General on behalf of respondent, has obviously no
what rules and regulations may be promulgated by an
application here. The resolution in question was issued by the
PCA in the exercise of its rule- making or legislative power. should refrain from exercising its jurisdiction until after an
However, only judicial review of decisions of administrative administrative agency has determined some question or some
agencies made in the exercise of their quasi-judicial function is aspect of some question arising in the proceeding before the
subject to the exhaustion doctrine. court. It applies where the claim is originally cognizable in the
courts and comes into play whenever enforcement of the claim
Even assuming arguendo that the principle of exhaustion of requires the resolution of issues which, under a regulatory
administrative remedies apply in this case, the records reveal that scheme, has been placed within the special competence of an
petitioners sufficiently complied with this requirement. Even administrative body; in such case, the judicial process is
during the drafting and deliberation stages leading to the suspended pending referral of such issues to the administrative
issuance of Memorandum Circular No. 13-6-2000, petitioners body for its view.24
were able to register their protests to the proposed billing
guidelines. They submitted their respective position papers However, where what is assailed is the validity or constitutionality
setting forth their objections and submitting proposed schemes of a rule or regulation issued by the administrative agency in the
for the billing circular.21 After the same was issued, petitioners performance of its quasi-legislative function, the regular courts
wrote successive letters dated July 3, 200022 and July 5, have jurisdiction to pass upon the same. The determination of
2000,23 asking for the suspension and reconsideration of the so- whether a specific rule or set of rules issued by an administrative
called Billing Circular. These letters were not acted upon until agency contravenes the law or the constitution is within the
October 6, 2000, when respondent NTC issued the second jurisdiction of the regular courts. Indeed, the Constitution vests
assailed Memorandum implementing certain provisions of the the power of judicial review or the power to declare a law, treaty,
Billing Circular. This was taken by petitioners as a clear denial of international or executive agreement, presidential decree, order,
the requests contained in their previous letters, thus prompting instruction, ordinance, or regulation in the courts, including the
them to seek judicial relief. regional trial courts.25 This is within the scope of judicial power,
which includes the authority of the courts to determine in an
In like manner, the doctrine of primary jurisdiction applies only appropriate action the validity of the acts of the political
where the administrative agency exercises its quasi-judicial or departments.26 Judicial power includes the duty of the courts of
adjudicatory function. Thus, in cases involving specialized justice to settle actual controversies involving rights which are
disputes, the practice has been to refer the same to an legally demandable and enforceable, and to determine whether or
administrative agency of special competence pursuant to the not there has been a grave abuse of discretion amounting to lack
doctrine of primary jurisdiction. The courts will not determine a or excess of jurisdiction on the part of any branch or
controversy involving a question which is within the jurisdiction of instrumentality of the Government.27
the administrative tribunal prior to the resolution of that question
by the administrative tribunal, where the question demands the In the case at bar, the issuance by the NTC of Memorandum
exercise of sound administrative discretion requiring the special Circular No. 13-6-2000 and its Memorandum dated October 6,
knowledge, experience and services of the administrative tribunal 2000 was pursuant to its quasi-legislative or rule-making power.
to determine technical and intricate matters of fact, and a As such, petitioners were justified in invoking the judicial power of
uniformity of ruling is essential to comply with the premises of the the Regional Trial Court to assail the constitutionality and validity
regulatory statute administered. The objective of the doctrine of of the said issuances. In Drilon v. Lim,28 it was held:
primary jurisdiction is to guide a court in determining whether it
We stress at the outset that the lower court had WHEREFORE, in view of the foregoing, the consolidated
jurisdiction to consider the constitutionality of Section 187, petitions are GRANTED. The decision of the Court of Appeals in
this authority being embraced in the general definition of CA-G.R. SP No. 64274 dated October 9, 2001 and its Resolution
the judicial power to determine what are the valid and dated January 10, 2002 are REVERSED and SET ASIDE. The
binding laws by the criterion of their conformity to the Order dated November 20, 2000 of the Regional Trial Court of
fundamental law. Specifically, B.P. 129 vests in the Quezon City, Branch 77, in Civil Case No. Q-00-42221 is
regional trial courts jurisdiction over all civil cases in which REINSTATED. This case is REMANDED to the court a quo for
the subject of the litigation is incapable of pecuniary continuation of the proceedings.
estimation, even as the accused in a criminal action has
the right to question in his defense the constitutionality of SO ORDERED.
a law he is charged with violating and of the proceedings
taken against him, particularly as they contravene the Bill
Smart Communications, Inc. & PILTEl v. NTC
of Rights. Moreover, Article X, Section 5(2), of the
Constitution vests in the Supreme Court appellate
jurisdiction over final judgments and orders of lower Chester Cabalza recommends his visitors to please
courts in all cases in which the constitutionality or validity read the original & full text of the case cited. Xie
of any treaty, international or executive agreement, law, xie!
presidential decree, proclamation, order, instruction,
ordinance, or regulation is in question.29
G.R. No. 151908 August 12, 2003
In their complaint before the Regional Trial Court, petitioners
averred that the Circular contravened Civil Code provisions on
SMART COMMUNICATIONS, INC. (SMART) and
sales and violated the constitutional prohibition against the
deprivation of property without due process of law. These are PILIPINO TELEPHONE CORPORATION (PILTEL),
within the competence of the trial judge. Contrary to the finding of petitioners,
the Court of Appeals, the issues raised in the complaint do not
entail highly technical matters. Rather, what is required of the
vs.
judge who will resolve this issue is a basic familiarity with the NATIONAL TELECOMMUNICATIONS COMMISSION
workings of the cellular telephone service, including prepaid SIM (NTC), respondent.
and call cards – and this is judicially known to be within the
knowledge of a good percentage of our population – and
expertise in fundamental principles of civil law and the x---------------------------------------------------------x
Constitution.
G.R. No. 152063 August 12, 2003
Hence, the Regional Trial Court has jurisdiction to hear and
decide Civil Case No. Q-00-42221. The Court of Appeals erred in
setting aside the orders of the trial court and in dismissing the GLOBE TELECOM, INC. (GLOBE) and ISLA
case.
COMMUNICATIONS CO., INC. (ISLACOM), measures to minimize if not totally eliminate the
petitioners, incidence of stealing of cellular phone units. This
vs. was followed by another Memorandum dated
COURT OF APPEALS (The Former 6th Division) and October 6, 2000 addressed to all public
the NATIONAL TELECOMMUNICATIONS telecommunications entities.
COMMISSION, respondents.
Isla Communications Co., Inc. and Pilipino
Facts: Telephone Corporation filed against the National
Telecommunications Commission, Commissioner
The National Telecommunications Commission Joseph A. Santiago, Deputy Commissioner Aurelio
(NTC) issued on June 16, 2000 Memorandum M. Umali and Deputy Commissioner Nestor C.
Circular No. 13-6-2000, promulgating rules and Dacanay, an action for declaration of nullity of NTC
regulations on the billing of telecommunications Memorandum Circular No. 13-6-2000 (the Billing
services. Circular) and the NTC Memorandum dated October
6, 2000, with prayer for the issuance of a writ of
The Memorandum Circular provided that it shall preliminary injunction and temporary restraining
take effect 15 days after its publication in a order.
newspaper of general circulation and three certified
true copies thereof furnished the UP Law Center. It Petitioners alleged that NTC has no jurisdiction to
was published in the newspaper, The Philippine regulate the sale of consumer goods such as the
Star, on June 22, 2000. Meanwhile, the provisions prepaid call cards since such jurisdiction belongs to
of the Memorandum Circular pertaining to the sale the Department of Trade and Industry under the
and use of prepaid cards and the unit of billing for Consumer Act of the Philippines; that the Billing
cellular mobile telephone service took effect 90 days Circular is oppressive, confiscatory and violative of
from the effectivity of the Memorandum Circular. the constitutional prohibition against deprivation of
property without due process of law; that the
On August 30, 2000, the NTC issued a Circular will result in the impairment of the
Memorandum to all cellular mobile telephone viability of the prepaid cellular service by unduly
service (CMTS) operators which contained prolonging the validity and expiration of the prepaid
SIM and call cards; and that the requirements of
identification of prepaid card buyers and call Jurisdiction: NTC vs. RTC
balance announcement are unreasonable. Hence,
they prayed that the Billing Circular be declared Administrative agencies possess quasi-legislative or
null and void ab initio. rule-making powers and quasi-judicial or
administrative adjudicatory powers. Quasi-
Globe Telecom, Inc and Smart Communications, legislative or rule-making power is the power to
Inc. filed a joint Motion for Leave to Intervene and make rules and regulations which results in
to Admit Complaint-in-Intervention and this was delegated legislation that is within the confines of
granted by the trial court. the granting statute and the doctrine of non-
delegability and separability of powers.
Respondent NTC and its co-defendants filed a
motion to dismiss the case on the ground of The doctrine of primary jurisdiction applies only
petitioners' failure to exhaust administrative where the administrative agency exercises its quasi-
remedies. Likewise, Globe and Islacom filed a judicial or adjudicatory function. Thus, in cases
petition for review, docketed as G.R. No. 152063, involving specialized disputes, the practice has
assigning the following errors. Thus, two petitions been to refer the same to an administrative agency
were consolidated in a Resolution dated February of special competence pursuant to the doctrine of
17, 2003. primary jurisdiction. The courts will not determine
a controversy involving a question which is within
Issues: the jurisdiction of the administrative tribunal prior
to the resolution of that question by the
1. Whether NTC has a jurisdiction and not the administrative tribunal, where the question
regular courts over the case; and demands the exercise of sound administrative
2. Whether Billing Circular issued by NTC is discretion requiring the special knowledge,
unconstitutional and contrary to law and public experience and services of the administrative
policy. tribunal to determine technical and intricate
matters of fact, and a uniformity of ruling is
Held: essential to comply with the premises of the
regulatory statute administered. In the case at bar, the issuance by the NTC of
Memorandum Circular No. 13-6-2000 and its
Hence, the Regional Trial Court has jurisdiction to Memorandum dated October 6, 2000 was pursuant
hear and decide Civil Case No. Q-00-42221. The to its quasi-legislative or rule-making power.
Court of Appeals erred in setting aside the orders of
the trial court and in dismissing the case. Ruling:
Constitutionality of the Circular Contrary to the finding of the Court of Appeals, the
issues raised in the complaint do not entail highly
In questioning the validity or constitutionality of a technical matters. Rather, what is required of the
rule or regulation issued by an administrative judge who will resolve this issue is a basic
agency, a party need not exhaust administrative familiarity with the workings of the cellular
remedies before going to court. This principle telephone service, including prepaid SIM and call
applies only where the act of the administrative cards – and this is judicially known to be within the
agency concerned was performed pursuant to its knowledge of a good percentage of our population –
quasi-judicial function, and not when the assailed and expertise in fundamental principles of civil law
act pertained to its rule-making or quasi-legislative and the Constitution.
power.
Hence, the consolidated petitions are granted but
However, where what is assailed is the validity or the decision of the Court of Appeals on the civil
constitutionality of a rule or regulation issued by cases are reversed and set aside. Thus, it is
the administrative agency in the performance of its remanded to the court a quo for continuation of the
quasi-legislative function, the regular courts have proceedings.
jurisdiction to pass upon the same. The
determination of whether a specific rule or set of
rules issued by an administrative agency
contravenes the law or the constitution is within
the jurisdiction of the regular courts.
EN BANC WHEREFORE, in view of the foregoing and by virtue of
preponderance of evidence, this Court hereby renders
judgment in favor of the plaintiff and against the
defendants.
G.R. No. 91551 August 16, 1991 1. Permanently enjoining the Defendants Dr. Jose V.
Abueva, in his capacity as UP President; Dr. Ernesto
Domingo, in his capacity as Chancellor of UP-Manila; the
U.P. BOARD OF REGENTS, DR. JOSE V. ABUEVA, in his
Nomination Committee for the Director of the UP-PGH
capacity as U.P. President, DR. ERNESTO O. DOMINGO, in
Medical Center and the UP Board of Regents, from
his capacity as Chancellor of U.P. Manila, and the
proceeding with the nomination of a Medical Director, until
Nomination Committee for the Director of the U.P.-P.G.H.
the expiration of the term of office of the plaintiff, Dr.
Medical Center, petitioners,
Felipe A. Estrella, Jr., in his capacity as Director of the
vs.
PGH or unless sooner removed, for cause provided by
HON. JAINAL D. RASUL, in his capacity as Presiding Judge,
law;
Branch 69 of the Regional Trial Court, Pasig, Metro Manila,
and DR. FELIPE A. ESTRELLA, JR., respondents.
2. Permanently enjoining the UP Board of Regents from
implementing the so-called Reorganization Plan of UP-
Ledesma, Saludo & Associates for private respondent.
PGH, unless there is a prior legislative enactment of
enabling law authorizing it and finally,
The principal issue in this case is whether or not respondent Dr. SO ORDERED.1
Felipe A. Estrella who holds the position of Director of the
Philippine General Hospital (PGH) can invoke security of tenure In an order dated October 23, 1989, the respondent Judge denied
during his term of office notwithstanding the abolition of the said petitioners' motion for reconsideration of the decision above-
position by the University of the Philippines Board of Regents. mentioned.
Petitioners seek to annul and set aside the decision dated August Assailing the above-mentioned rulings, petitioners allege as
28, 1989 and the order dated October 23, 1989 issued and errors the following:
rendered by respondent Judge, Honorable Jainal D. Rasul of the
Regional Trial Court, Branch 69, Pasig, Metro Manila. The
REASONS FOR THE ALLOWANCE OF THE WRIT
dispositive portion of the decision in question reads as follows:
I
RESPONDENT JUDGE COMMITTED GRAVE ABUSE OF RESPONDENT JUDGE COMMITTED GRAVE ABUSE OF
DISCRETION AMOUNTING TO LACK OF JURISDICTION IN DISCRETION AMOUNTING TO LACK OF JURISDICTION IN
HOLDING THAT RESPONDENT ESTRELLA IS ENTITLED TO HOLDING THAT HE CAN SUBSTITUTE HIS OWN JUDGMENT
THE PROTECTIVE MANTLE OF THE CONSTITUTIONAL FOR THAT OF THE U.P. BOARD REGENTS.
GUARANTEE OF SECURITY OF TENURE
VII
II
RESPONDENT JUDGE COMMITTED GRAVE ABUSE OF
RESPONDENT JUDGE COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OF JURISDICTION IN
DISCRETION AMOUNTING TO LACK OF JURISDICTION IN HOLDING THAT NON-IMPLEMENTATION OF THE
HOLDING THAT THE REORGANIZATION OF U.P. MANILA REORGANIZATION PLAN WILL NOT CAUSE CONSIDERABLE
INCLUDING THE PGH, WAS DONE IN BAD FAITH DAMAGE TO U.P. IN GENERAL AND TO PGH IN
PARTICULAR.2
III
The petition is devoid of merit.
RESPONDENT JUDGE COMMITTED GRAVE ABUSE OF
DISCRETION AMOUNTING TO LACK OF JURISDICTION IN The facts and background of the case as narrated by the trial
HOLDING THAT RESPONDENT ESTRELLA NEED NOT court are as follows—
EXHAUST ADMINISTRATIVE REMEDIES BEFORE HE CAN
BRING SUIT AGAINST THE U.P. BOARD OF REGENTS, ET AL. That on June 26, 1986, plaintiff Dr. Felipe A. Estrella, Jr.,
was appointed by the defendant Board of Regents BOR
IV as Director of the Philippine General Hospital, to take
effect "1 September 1986 until 30 April 1992"(Exh. "A-
RESPONDENT JUDGE COMMITTED GRAVE ABUSE OF 14");that the defendant U.P. Board of Regents speaking
DISCRETION AMOUNTING TO LACK OF JURISDICTION IN thru its then University Secretary Professor Martin
HOLDING THAT THE REORGANIZATION PLAN FOR THE U.P. Gregorio intended to have the plaintiff serve his full term,
PGH MEDICAL CENTER CANNOT YET BE IMPLEMENTED as Director, since any other arrangement would impede
the hospital's development, not to mention the continuity
V of its service operations (Exh. "A"); that the duties and
responsibilities, under Chapter 29, of the Revised
Administrative Code, as PGH Director, inter alia, to direct
RESPONDENT JUDGE COMMITTED GRAVE ABUSE OF
and manage various activities within the hospital;
DISCRETION AMOUNTING TO LACK OF JURISDICTION IN
formulate and implement regulations; develop institutional
HOLDING THAT THE U.P. BOARD OF REGENTS HAS NO
plans and policies; approve/recommend budget proposals
AUTHORITY TO REORGANIZE
of the hospital; execute contracts; represent the hospital
in proper functions; approve and sign warrants, checks,
VI
vouchers and recommend or endorse appointments of Preliminary Injunction, enjoining defendants from
personnel to higher authorities (Exh. "M"). implementing the reorganization plan for the UP-PGH
medical Center (Exh. "A" Affidavit of plaintiff Dr. Felipe A.
On September 16, 1987, barely two (2) weeks after Estrella, Jr.; Exh. "10" Affidavit of defendant Dr. Ernesto
assuming the presidency of the University of the O. Domingo; TSN pp. 1-23, June 1, 1989, TSN pp. 1-106,
Philippines defendant Jose V. Abueva submitted a June 1, 1989; TSN pp.1-52, June 1, 1989).3
memorandum to the Board of Regents to reorganize the
U.P. Manila including the Philippine General Hospital with Respondent Judge, based on the evidence presented, concluded
a draft resolution for approval of the Board of Regents, that the reorganization of PGH was done in bad faith.
recommending that certain key positions of UP Manila Accordingly, the lower court ruled that respondent Dr. Estrella
including that of plaintiff be declared vacant (Exhs. "C" to cannot be removed from office as a result of such defective
"C-3"): that on March 20, 1988, the defendant Board of abolition of the position to which he was appointed. Significant in
Regent upon recommendation of defendants Abueva and this regard is the following pronouncement of the lower court:
Domingo approved the so-called reorganization plan for
the Philippine General Hospital. Going over the organizational structure of present set-up
of the PGH and proposed reorganizational structure, it
On April 29, 1988, defendant Dr. Ernesto Domingo acting appears that there are other minor differences aside from
on instruction of defendant Dr. Jose v. Abueva, U.P. changes of designations and enlargement of functions
President, issued a memorandum creating the and powers, namely: (1) The positions of Assistant
Nomination Committee for the UP-PGH Medical Center Director for Administration and Assistant Director for
Director; that on May 10, 1988, defendant-members of Fiscal matters in the present set-up are combined into
the Nomination Committee thus created, are scheduled to only one position of Assistant Director for Administrative
nominate plaintiff s replacement as Director; that and Fiscal Matters in the reorganization plan; (2) The
consequently on May 2, 1988, plaintiff filed with this position of Assistant Director for Health Operation in the
Court, his complaint for Injunction with Preliminary present set-up was changed to position of Director of
Injunction of temporary restraining Order, seeking to Health Services, directly under the UP-PGH Medical
enjoin defendants Abueva, Domingo, the Nomination Center Director with one Assistant Director for Allied
Committee and the ITP Board of Regents from Medical Services, under it, in the reorganization plan and
proceeding with the nomination of UP-PGH medical (3) The five (5) Departments of Oncology, Out-Patient
Center Director, in order to forestall the consequent Department, Emergency Room, Charity Ward and Pay
removal/dismissal of the plaintiff Dr. Felipe A. Estrella, Jr., Ward under the present set-up were converted into
incumbent PGH Director, even before the expiration of his Institute of Oncology, Out-Patient Hospital, Emergency
term of office on April 30, 1992 without any cause Hospital, Charity Hospital and Non-Charity Hospital under
provided by law. the reorganization plan.
On May 2, this Court issued the Restraining Order and on In other words, these five (5) units were merely enlarged,
May 30, After due hearing this Court, thru its then expanded and called hospitals headed each by a
Presiding Judge Hon. Julio Logarta issued the Writ of Director. The Director of the PGH under the present set-
up became Director of UP-PGH Medical Center. Aside Education effective May 16,1967 until May 17,1972 or unless
from the three changes above and change of sooner terminated. Before the expiration of his term of office,
designations and transfers of duties, the structure President Salvador P. Lopez removed him as dean of the College
remains substantially the same. The leadership element of Education and tranferred him to the office of the UP President.
which the defendant Abueva wants to impress upon this Upholding the right of Professor Sta. Maria to security of tenure,
Court, encourages reorganization and justifies abolition of We explained out that "... a college dean holding an appointment
positions. But the whole reorganization set-up under our with a fixed term ... cannot, without his consent, be terminated
law cannot or should not have the effect of abolishing the before the end of his term. He cannot be asked to give up his
position of the plaintiff unless legal requirements are post. Nor may he be appointed as dean of another college. Much
complied with.(Brallo vs. Enage, 94 Phil. 732) If the less can he be transferred to another position even if it be
reorganization plan results in abolishing the position of dignified with a dean's rank."
the plaintiff and in putting in his place another one, with
substantially the same duties, not to say qualifications, in Petitioners argue, however, that the abolition of the position of
the name of leadership, it will surely be considered a respondent Dr. Estrella Jr. negates his claim to security of tenure.
device to unseat the incumbent and to circumvent the The argument is devoid of merit.
constitutional and statutory prohibition of removal from
office of a civil service officer even without cause provided It is clear from the record that the PGH itself was not abolished in
by law. Plaintiffs position should not therefore be deemed the reorganization plan approved by the UP Board of Regents.
abolished by mere implication. (Cuneta vs. CA, 1 SCRA The PGH was merely renamed "UP-PGH Medical Center" and
663, 111 Phil. 249) If the abolition of office is made to some of it functions and objectives were expanded or
circumvent the constitutional security of tenure of civil consolidated. There is no substantial distinction, in terms of
service employees, our Supreme Court, has ruled that functions, between PGH and the proposed UP-PGH Medical
such abolition is null and void. (Gutierrez vs. CA, 1- Center.
25972, 2 /26 / 68, 26 SCRA 32)4
While PGH itself was not abolished, the position of PGH Director
Respondent Dr. Estrella was appointed Director of PGH on June was abolished and in its place, the position of UP-PGH Medical
26, 1986 by the LTP Board of Regents. His appointment was to
1âwphi 1
(b) To provide for the establishment of one or more It is true that a valid and bona fide abolition of an office denies to
Colleges of Liberal Arts; a College of Law; a College of the incumbent the right to security of tenure.8 However, in this
Social and Political Science; a College of Medicine and case, the renaming and restructuring of the PGH and its
Surgery; a College of Pharmacy; a College of Dentistry; a component units cannot give rise to a valid and bona fide
College of Veterinary Science; a College of Engineering; abolition of the position of PGH Director. This is because where
a College of Mines; a College of Agriculture; a College of the abolished office and the offices created in its place have
Education; a School of Fine Arts; a School of Forestry; a similar functions, the abolition lacks good faith.9 We hereby apply
Conservatory of Music, and such other colleges and the principle enunciated in Cesar Z. Dalio vs. Hon.Salvador M.
schools as the Board of Regents may deem Mison10 that abolition which merely changes the nomenclature of
necessary: Provided, That the Board of Regents may positions is invalid and does not result in the removal of the
establish these colleges, or any of them, in Manila or in incumbent.
any other place in the Archipelago, as soon as in its
judgment conditions shall favor their opening and finds The above notwithstanding, and assuming that the abolition of the
shall be available for their maintenance: And provided position of the PGH Director and the creation of a UP-PGH
further, That the Board of Regents shall have the power Medical Center Director are valid the removal of the incumbent is
to combine two or more of the colleges authorized by this still not justified for the reason that the duties and functions of the
Act, in the interests of economy and efficiency And two positions are basically the same. The UP-PGH Medical
provided finally, That the Philippine Medical School as Center is essentially the same PGH hence, the Medical Center
established by Act Numbered Fourteen Hundred and Director will be performing duties very similar to the present PGH
Fifteen as amended, shall become the College of Director. It cannot be invoked to sustain the argument that
Medicine and Surgery of the Philippine University as soon respondent is not entitled to security of tenure. In Palma-
as two or more colleges of the University of the Fernandez v. de la Paz,11 the abolition of the position of "Chief of
Philippines shall have been established and in actual Clinic" and the creation of the position of "Assistant Director,
operation. Professional Services" were set aside for the reason that the two
positions are basically one and the same except for the change of
It is therefore clear that the authority of the UP is limited to what is nomenclature.
expressly provided in Act No. 1870 as amended, that is, to
combine or merge colleges. that is all the law speaks of in such The proposal to establish five hospitals within the UP-PGH
instance. Medical Center, and with it, the proposal to create five hospital
director positions militate against the propriety of giving due
course to this petition. As presently organized, there is only one
hospital director position in the plantilla of positions of the PGH, WHEREFORE, the petition is DENIED for lack of merit. The
the PGH Director. In the proposed reorganization, such number Decision dated August 28, 1989 and Order dated October 23,
will be increased to six, one UP-PGH Medical Center Director and 1989 of the respondent Judge are hereby AFFIRMED in toto. No
five directors for each of the five hospitals proposed to be costs.
established namely, the Out-Patient Hospital, Emergency
Hospital, Charity Hospital, Non-Charity Hospital and Institute of SO ORDERED.
Oncology. In Guerrero vs. Arizabal,12 We held that the creation of
additional management positions in a proposed reorganization is
evidence of bad faith and is in violation of Republic Act No. 6656.
We hold that the same applies to the PGH reorganization.
UP BOARD OF REGENTS v RASUL
Finally, the admission by petitioner Dr. Jose V. Abueva that the
staffing pattern for the reorganized PGH has not been prepared is
fatal to petitioners' cause. In Dario v. Mison,13 We made the FACTS:
observation that no reorganization of the Bureau of Customs
actually took place since a staffing pattern which could have been The UP Board of Regents appointed Dr. Felipe Estrella as
the basis for hiring and g was lacking. In this case, petitioners
were poised to nominate and appoint a UP-PGH Medical Center the Director of PhilippineGeneral Hospital or PGH
Director inspite of the absence of a staffing pattern. The absence from September 1986 till April 1992. Barely 2 weeks
of such an important element in the reorganization plan
contradicts the petitioners' claim of good faith and only proves afterappointment, Dr. Abuava, as the President of the UP
that petitioners were unreasonably in a hurry to remove sent a memorandum to the Board of Regents to
respondent Estrella from his office.
Reorganize PGH. Upon this recommendation, the Board
Anent the issue regarding respondent Estrella's failure to exhaust of Regents approved the re-organization plan and
all administrative remedies, We hold that this case has special
circumstances that made it fall under the jurisprudentially
Nomination Committee was formed.
accepted exceptions to the rule. As the facts show, respondent This committee ought to choose a replacement for
Dr. Estrella was about to be replaced by the Nomination
Dr. Estrella as to fill up the alleged vacant UP-PGH
Committee. He must have believed that airing his protest with the
Board of Regents would only be fruitless and that unless he goes Director. Dr. Estrella filed an injunction case against the
to the courts, irreparable damage or injury on his part will be
NominationCommittee and the Board of Regents to
caused by the implementation of the proposed reorganization.
forestall the removal or dismissal of DrEstrella
Respondent Judge did not commit any reversible error much less
grave abuse of discretion. The facts as supported by evidence
1âwphi1
ISSUE:
established may no longer be disturbed.
SECOND DIVISION
Whether Dr Estrella can be rightfully removed because of
PGH’s reorganization
4. That Tan Chiat Bee alias Tan Lian Lay died in the 10. That on February 13, 1957, the respondent Veterans
service on April 4, 1945 in the battle at Ipo Dam, Rizal Back Pay Commission, through its Secretary & Chief of
Province, Philippines; he was duly recognized as a Office Staff, made a formal reply to the aforesaid claim of
guerrilla veteran and certified to by the Armed Forces of the herein petitioner denying her request on the ground
the Philippines as having rendered meritorious military that aliens are not entitled to back pay;
services during the Japanese occupation;
11. That upon refusal of the Veterans Back Pay
5. That petitioner as the widow of the said recognized Commission the petitioner brought the case direct to this
deceased veteran, filed an application for back pay under Honorable Court by way of mandamus;
the provisions of Republic Act No. 897, the resolution of
the Veterans Back Pay Commissions dated November 12. That petitioner and respondent admit the existence
19, 1953 and the letter of the Veterans Back Pay and authenticity of the following documents;
Commission dated December 9, 1953;
Annex A—Resolution of the Veterans Back Pay dated
6. That on June 18, 1955, the Secretary and the Chief of November 19, 1953.
Office Staff of Veterans Back Pay Commission sent a
letter to General Vicente Lopez of the United States-
Annex B—Letter dated December 9, 1953.
Chinese Volunteers in the Philippines apprising the latter
Annex C—Letter dated June 18, 1955.
Annex D—Executive Order No. 21 dated October 28, Manila, July 31, 1957.
1944.
Based on the foregoing, the lower court rendered judgment the
Annex E—Executive Order No. 68 dated September 26, dispositive portion of which, reads:
1945.
Wherefore, the petition is granted, ordering respondent
Annex F—Minutes of the Resolution of the Back Pay Commission to give due course to the claim of herein
Commission regarding the opinion of the Secretary of petitioner to the backpay to which her deceased husband
Justice dated February 8, 1956. was entitled as member of a duly recognized guerrilla
organization.
Annex G—Letter of Back Pay Commission dated
February 26, 1954 to Secretary of Justice. Against the decision, the respondent instituted this appeal
averring once more, in its assignment of errors, the special and
Annex H—Opinion No. 213 series of 1956 of the affirmative defenses that the petitioner failed to exhaust available
Secretary of Justice. administrative remedies; that the suit is, in effect, an action to
enforce a money claim against the government without its
Annex I—Reply of Veterans Backpay Commission. consent; that mandamus will not lie to compel the exercise of •a
discretionary function; and that the Republic Act Nos. 304 and
•897 already referred to were never intended to benefit aliens.
Annex J—Explanatory Note to House Bill No. 1953.
We find no merit in the appeal. As to the claim that mandamus is
Annex K—Explanatory note to Senate Bill No. 10.
not the proper remedy to correct the exercise of discretion of the
Commission, it may well be remembered that its discretion is
Annex L—Explanatory note to House Bill No. 1228, now limited to the facts of the case, i.e., in merely evaluating the
Republic Act No. 897. evidence whether or not the claimant is a member of a guerrilla
force duly recognized by the United States Army. Nowhere in the
Annex M—Joint Resolution No. 5 of the First Congress of law is the respondent Commission given the power to adjudicate
the Philippines. or determine rights after such facts are established. Having been
satisfied that deceased Tan Chiat Bee was an officer of a duly
13. That the parties waive the presentation of further recognized guerrilla outfit, certified to by the Armed Forces of the
evidence; Philippines, having served under the United States-Chinese
Volunteers in the Philippines, a guerrilla unit recognized by the
14. That the respondents will file its memorandum within United States army and forming part of the Philippine Army, it
ten (10) days from August 1, 1957 and the petitioner may becomes the ministerial duty of the respondent to give due
file her memorandum within ten (10) days from receipt of course to his widow's application. (See sections 1 and 6,
respondent's memorandum, after which the case is Republic Act •897). Note that the Chief of the Finance Service,
deemed submitted for decision. Camp Murphy, has accepted the backpay due the petitioner's
husband and the same was passed in audit by the maximexpressio unius est exclusio alterius, I think, finds
representatives of the Auditor General. application here.
It is insisted by the respondent Commission that aliens are not Moreover, Executive Order No. 21, dated October 28,
included within the purview of the law. We disagree. The law is 1944, expressly declared that, Sections 22 (a) and 27 of
contained in Republic Act Nos. 304 and 897 is explicit enough, Commonwealth Act No. 1 to the contrary notwithstanding,
and it extends its benefits to members of "guerrilla forces duly "all persons of any nationality or citizenship, who are
recognized by the Army of the United States." From the plain and actively serving in recognized military forces in the
clear language thereof, we fail to see any indication that its Philippines, are thereby considered to be on active
operation should be limited to citizens of the Philippines only, for service in the Philippine Army."
all that is required is that the guerrilla unit be duly recognized by
the Army of the United States. We are in full accord with Opinion It is the respondent's main argument that it could not have been
No. 213, series of 1956, of the Secretary of Justice, which reads: the intention of Congress to extend its benefit to aliens, as the
purpose of the law was "precisely to help rehabilitate members of
Section 1 of the cited Act (Republic act No. 304, as the Armed Forces of the Philippines and recognized guerrillas by
amended by Republic Act No. 897), otherwise known as giving them the right to acquire public lands and public property
the Back Pay Law, recognizes the rights to the backpay of by using the back pay certificate", and "it is fundamental under
members of "guerrilla forces duly recognized by the Army the Constitution that aliens except American citizens cannot
of the United States, among others. A perusal of its acquire public lands or exploit our natural resources".
provisions reveals nothing which may be construed to Respondent Commission fails to realize that this is just one of the
mean that only Filipino citizens are entitled to back pay various uses of the certificate; and that it may also be utilized for
thereunder. On the contrary, the statute expressly the payment of obligations to the Government or to any of its
includes within its coverage "persons under contract with branches or instrumentalities, i.e., taxes, government hospital
the Government of the Commonwealth", which clause bills, etc. (See Sec. 2, Rep. act No. 897).
was construed by this office to refer to service" by the
government (Opinion No. •137, s. 1953), a majority of As further observed by the lower court:
whom were non-citizens. Thus, the Opinion No. 30, s.
1949, this office ruled that a civil service employee of the It is one thing to be entitled to backpay and to receive
U.S. Coast and Geodetic Survey rendering the service to acknowledgment therefor, and another thing to receive
the Philippine Government when war broke out on backpay certificates in accordance with the resolutions of
December 8, 1941, was entitled to back pay. the Commission and to make use of the same.
As regards guerrillas, it seems clear that all the law It was, therefore, unreasonable if not arbitrary on the part of
requires is that they be "duly recognized by the Army of respondent Commission to deny petitioner's claim on the basis.
the United States." Section 1 of the Back Pay Law, it is
also noted, enumerates those who are not entitled to its
It is further contended by the Commission that the petitioner
benefits; recognized guerrillas who were not Filipino
should have first exhausted her administrative remedies by
citizens are not among those expressly mentioned. The
appealing to the President of the Philippines, and that her failure [G.R. No. L-12944. March 30, 1959.]
to do so is a bar to her action in court (Montes vs. The Civil
Service Board of Appeals, 101 Phil., 490; 54 Off. Gaz. [7] 2174. FACTS:
The respondent Commission is in estoppel to invoke this rule, 1. That the petitioner is of legal age, a widow and a resident of the
considering that in its resolution (Annex F of the Stipulation of
Philippines and that the respondent is a government instrumentality or
Facts) reiterating its obstinate refusal to abide by the opinion of
agency, duly vested with authority to implement the provisions of Backpay
the Secretary of Justice, who is the legal adviser of the Executive
Department, the Commission declared that — Law, otherwise known as Republic Act No. 897, further amending Republic
Act No. 304;
The opinions promulgated by the Secretary of Justice are 2. That the petitioner is the widow of the late Lt. Tan Chiat Bee alias Tan
advisory in nature, which may either be accepted or Lian Lay, a Chinese national, and bonafide member the 1st Regiment,
ignored by the office seeking the opinion, and any United State-Chinese Volunteers in the Philippines; died in a battle at Rizal
aggrieved party has the court for recourse, (Annex F) Province; and certified by the Armed Forces of the Philippines as having
rendered aritorious military services during the Japanese occupation;
thereby leading the petitioner to conclude that only a final judicial 3. That petitioner as widow of the said recognized deceased veteran, filed an
ruling in her favor would be accepted by the Commission. application for back pay
4. The Secretary and Chief of Office Staff the Veterans Back Pay
Neither is there substance in the contention that the petition is, in Commission sent a letter to General Vicente Lopez of the United States-
effect, a suit against the government without its consent. the relief
Chinese Volunteers in the Philippines apprising the latter that the
prayed for is simply "the recognition of the petitioner-appellee"
Commission has reaffirmed its solution granting the back pay to alien
under the provisions of sections 1 and 2 of Republic Act No. 897,
and consists in "directing an agency of the government to perform members; the AFP certified certified that deceased veteran has rendered
an act . . . it is bound to perform." Republic Act Nos. 304 and 897 service as a recognized guerrilla
necessarily embody state consent to an action against the 5. That after due deliberation respondent revoked its previous stands and
officers entrusted with the implementation of said Acts in case of ruled that aliens are not entitled to back pay;
unjustified refusal to recognize the rights of proper applicants. 6. That on February 13, 1957, the respondent Veterans Back Pay
Commission, through its Secretary & Chief of Office Staff, made a formal
The decision appealed from should be, and hereby is, affirmed. reply to the aforesaid claim of the herein petitioner denying her request on
No costs. So ordered. the ground that aliens are not entitled to backpay;
7. That upon refusal of the Veterans Back Pay Commission the petitioner
brought the case direct to this Honorable Court by way of mandamus;
The trial court ordered respondent Commission to give due course to the
claim of herein petitioner. Against the decision, the respondent instituted this
appeal and it further contended by the Commission that the petitioner should
have first exhausted her administrative remedies by appealing to the
President of the Philippines, and that her failure to do so is a bar to her
action in court.